Find the subgame perfect nash equilibrium of this game

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Consider the following two-player game: First player 1 selects a number x, which must be greater than or equal to zero. Player 2 observes x. Then, simultaneously and independently, player 1 selects a number y1 and player 2 selects a number y2 at which point the game ends. Player 1's payoff is u1 = y1y2 + xy1 - y12 - (x3/3), and player 2's payoff is u2 = -(y1 - y2)2. Find the subgame perfect Nash equilibrium of this game.

Reference no: EM131098988

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