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Consider the following bargaining problem: 20 dollars needs to be split between Alice and Bob. Stage 1: Bob makes an initial offer (between SO and $20). Alice then responds by either (1) accepting Bob's initial offer and ending the game, or (2) rejecting and moving the game to stage 2. Stage 2: Alice makes a counter offer (between $0 and $20). Bob then respond by either (1) accepting Alice's counter offer and ending the game, or (2) rejecting and moving the game to stage 3. Stage 3: Bob makes a final offer (between $0 and 820). Alice then responds by accepting or rejecting Bob's final offer. If Alice rejects, both Alice and Bob get nothing and the game ends. If Alice accepts, the money is split per the final offer and the game ends.