(Solved): The entrant has finite money reserves. Let's assume these reserves are $300. D stands forduop ...

The entrant has finite money reserves. Let's assume these reserves are $300. πD stands forduopoly profits, and πM represents monopoly profits. Every time company I decides to fight with company E, and enters into a price war, it costs $200 to I, and $100 to E.
a) Describe step by step how you would find the SPNE of the game.

b) Given that E has reserves of 300, explain intuitively why in the last step, the only E's option is to exit the market.

c) Intuitively explain why the company with the largest reserves can remove from the market the
new entrant.