eeps is a social media company that, unfortunately, has gone bankrupt. Peeps's creditor, Kase Bank and Brot Bank, are now bargaining over $10 million that was left after Peeps's asset were liquidated. Given the seniority of its debt claims, Kase Bank gets to make an offer first to Brot Bank on Day 1 of negotiations. If the offer is rejected, Brot Bank proposes a counteroffer on Day 2. If that is still not accepted, Kase Bank makes a final, take-it-or-leave-it offer to bank Brot on Day 3. If there is still no agreement after the final day of negotiations, the court will need to get involved and the amount that both Brot Bank and Kase Bank will be able to receive will drop to virtually zero. Assuming that the discount rates for Kase Bank and Brot Bank are 3% and 8%, respectively: a) How much of the $10 million will Kase Bank and Brot Bank end up with? [3 marks] b) Would the outcome change if the negotiation could be extended indefinitely? Explain. [4 marks]