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Consider the following sequential move game. First player A must decide whether to play Out or In. In the former case the game ends and both players earn £5. In the latter case Player B is called to move and has to decide between Roll and Not roll a dice. If Player B chooses Not roll Player A gets 0 and B gets £14. If instead B chooses Roll, a dice is rolled. If a 6 shows up Player A gets 12 and B gets 10. Otherwise, A gets O and B gets 12. The Subgame Perfect Equilibrium of this game is: Select one: a. {In, Not Roll} O b. {Out, Roll} c. {Out} d. {In, Roll} e. {Out, Not Roll}

Consider the following sequential move game. First player A must decide whether to play Out or In. In the former case the game ends and both players earn £5. In the latter case Player B is called to move and has to decide between Roll and Not roll a dice. If Player B chooses Not roll Player A gets 0 and B gets £14. If instead B chooses Roll, a dice is rolled. If a 6 shows up Player A gets 12 and B gets 10. Otherwise, A gets O and B gets 12. The Subgame Perfect Equilibrium of this game is: Select one: a. {In, Not Roll} O b. {Out, Roll} c. {Out} d. {In, Roll} e. {Out, Not Roll}

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Consider the following sequential move game. First player A must decide whether to play Out or In. In the former case the game ends and both players earn £5. In the latter case Player B is called to move and has to decide between Roll and Not roll a dice. If Player B chooses Not roll Player A gets 0 and B gets £14. If instead B chooses Roll, a dice is rolled. If a 6 shows up Player A gets 12 and B gets 10. Otherwise, A gets O and B gets 12. The Subgame Perfect Equilibrium of this game is: Select one: a. {In, Not Roll} O b. {Out, Roll} c. {Out} d. {In, Roll} e. {Out, Not Roll}
Transcribed Image Text:Consider the following sequential move game. First player A must decide whether to play Out or In. In the former case the game ends and both players earn £5. In the latter case Player B is called to move and has to decide between Roll and Not roll a dice. If Player B chooses Not roll Player A gets 0 and B gets £14. If instead B chooses Roll, a dice is rolled. If a 6 shows up Player A gets 12 and B gets 10. Otherwise, A gets O and B gets 12. The Subgame Perfect Equilibrium of this game is: Select one: a. {In, Not Roll} O b. {Out, Roll} c. {Out} d. {In, Roll} e. {Out, Not Roll}
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