3. Consider the ultimatum bargaining game as introduced in the class with the following modification.
The total prize is of value 1. Player 1 makes the first offer which player 2 either accepts of rejects. If
the offer is rejected, both get 0. In case of acceptance, if the share of player i is r, and that of player
j is z, where j ≠i, then the payoff of player i is z, Br, with β > 0. The parameter β can be
interpreted as a measure of envy of player i towards player j. Describe a subgame perfect equilibrium
of this game where there is a settlement.