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A parent threatens a screaming child: 'If you don't stop, we turn around and go home.' Model it as a sequential game. The child moves first: Quiet Down or Keep Screaming. Then the parent moves: Carry On to the beach or Drive Home. Payoffs (parent, child):
(After Quiet Down the parent always Carries On.) Here is the parent's payoff from turning around, currently . Both players are rational and payoff-maximising, and the parent breaks ties by Carrying On.
What is the smallest integer value of for which the threat becomes credible, so that in the subgame-perfect equilibrium the child Quiets Down?