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Viktor and Rebecca are co-workers at Apple. Their manager has assigned Rebecca and Viktor on an important project and has asked them to collaborate...
Viktor and Rebecca are co-workers at Apple. Their manager has assigned Rebecca and Viktor on an important project and has asked them to collaborate on the project, instead of competing. Since Rebecca is the senior employee, she can initiate the collaboration. If she does not collaborate, Viktor can choose to collaborate with her anyways, which will earn Rebecca a payoff of 9, and Victor a payoff of 15. If Viktor chooses not to collaborate, they will complete the project separately, and earn a payoff of 8 each.
If Rebecca chooses to collaborate, Viktor can choose to collaborate or work separately from her. If Viktor chooses to work separately, Rebecca can claim credit for his work or share the results. If she claims credit for his work, they will both earn a payoff of 10. If Rebecca shares the results, she will get payoff of 9 and Viktor will earn a payoff of 11.
If Viktor chooses to collaborate, Rebecca can choose to claim credit for his work, in which case she will earn a payoff of 30 and Viktor will earn payoff of 9. Alternatively, if Viktor chooses to collaborate, Rebecca can choose to share the results, so that she earns a payoff of 20, and he earns a profit of 25.
a. Draw the decision tree of the game, making sure to label all players, nodes, actions, and payoffs.
b. How many subgames are there in the game?
c. What is the Subgame Perfect Nash Equilibrium of the game? Write it out in the appropriate format.