The Centipede Game Revisited: Two players are playing two consecutive games. First, they play the
Centipede Game described in Figure (a). After the Centipede Game they play the coordination game
shown in Figure (b).
(a) (b)
(a) What are the Nash equilibria of each stage game?
(b) Find all the pure-strategy subgame-perfect equilibria with extreme discounting ( = 0). Be precise
in defining history-contingent strategies for both players.
(c) Now let = 1. Find a subgame-perfect equilibrium for the two-stage game in which the players
receive the payoffs (2, 2) in the first stage game.
(d) What is the lowest value of for which the subgame-perfect equilibrium you found in (c) survives?