Show that army can increase its subgame perfect equilibrium

Reference no: EM13907029

(Burning a bridge) Army 1, of country 1, must decide whether to attack army 2, of country 2, which is occupying an island between the two coun- tries. In the event of an attack, army 2 may fight, or retreat over a bridge to its mainland. Each army prefers to occupy the island than not to occupy it; a fight is the worst outcome for both armies. Model this situation as an extensive game with perfect information and show that army 2 can increase its subgame perfect equilibrium payoff (and reduce army 1's payoff) by burning the bridge to its mainland, eliminating its option to retreat if attacked.

Reference no: EM13907029

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