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Considering a two-player, sequential game where each player can choose to play right or left. Player 1 moves first, and player 2 observes 1’s actual move and decides to move up or down. If both of them moves left, then payoffs for player 1 is $-5 and playoffs for player 2 is $10. If player 1 moves left and 2 moves right, then both player 1 and 2 get $20. If player 1 moves right, player 1 receives $0 and player 2 receives $25.
a) Write the above game in extensive form.
b) This game consists of two stages. Write down the feasible strategies at each stage.
c) Find the Sub-game Nash Equilibrium outcomes to this game and the corresponding payoffs.
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