Question

4. Using backward induction to find any equilibrium outcome Primo R Secundo Secundo Secundo DE 90 50 100 50 -20 10 -15 12 100

Answer 1

Backwards induction mean that Secundo will choose his best response first corresponding to Primo's strategies. After that, Primo will choose his best response from the 3 options.

So, Secundpo's best response is A(70) corresponding to L, C(50) corresponding to C, and F(100) corresponding to R.
Now, Primo's choices are:
(L, A) = (50, 70); (C, C) = (100, 50); (R, F) = (50, 100)

Primo's best response is C(100).

So, the equilibrium outcome of the game is (C, C) = (100, 50)