Question C1. Consider the following game played between two players, A and B. The players take it in turns to remove 1,

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Question C1 Consider The Following Game Played Between Two Players A And B The Players Take It In Turns To Remove 1 1 (29.51 KiB) Viewed 30 times

Question C1. Consider the following game played between two players, A and B. The players take it in turns to remove 1, 2 or 3 flags from a pile of 17 flags, with player A moving first. The player who takes the final flag, leaving none for the next player wins the game receiving a nominal payoff of 1, the other player receiving nothing. a) Define the concept of sub-game perfect equilibrium and explain how this differs from the Nash Equilibrium b) In the game outlined above, derive the sub-game perfect equilibrium. c) Explain how the equilibrium outcome changes if the initial number of flags was changed from 17 to 16.