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Consider the Following Two-Player Sequential Move Game

Question 18

Multiple Choice

Consider the following two-player sequential move game. Player 1 moves first and chooses between Top and Bottom. Player 2 gets to see what Player 1 chose and then responds with Left or Right. If Player 1 chooses Top and Player 2 chooses Left, then Player 1 gets $3 and Player 2 gets $2. If Player 1 chooses Top and Player 2 chooses Right, then Player 1 gets $1 and Player 2 gets $1. If Player 1 chooses Bottom and Player 2 chooses Left, then Player 1 gets $0 and Player 2 gets $4. If Player 1 chooses Bottom and Player 2 chooses Right, then Player 1 gets $5 and Player 2 gets $3. The subgame perfect equilibrium of this game is:


A) {Top, Left}.
B) {Top, Right}.
C) {Bottom, Left}.
D) {Bottom, Right}.

Correct Answer:

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