Question: Question 18: Consider the following sequential game. Player 1 (P1) plays first, and Player 2 (P2) plays after observing the choice of P1. Re- call

Question 18: Consider the following sequential game. Player 1 (P1) plays first, and Player 2 (P2) plays after observing the choice of P1. Re- call that the first number in each parenthesis is the payoff of P1, while the second is the payoff of P2. Player 1 A B Player 2 Player 2 C D E F (3, 3) (6,8) (8, 6) (5, 5) Consider the following strategies: I - P1 plays A, while P2 plays (D,F), that is, P2 plays D if P1 plays A and F if P1 plays B. II - P1 plays B, while P2 plays (D,E), that is, P2 plays D if Pl plays A and E if P1 plays B. Which options are a Nash Equilibrium (NE) and a Subgame Perfect Equilibrium (SPE)? (A) Option I is not a NE. Option II is a SPE. (B) Option I is a SPE. Option II is not a NE. (C) Option I is a NE. Option II is a SPE. (D) Option I is a SPE. Option II is a NE. (E) Both options I and II are a SPE

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