What is the role of backward induction in extensive form games?

What is the role of backward induction in extensive form games?

The role of backward induction in extensive form games is to determine the optimal strategy for each player by working backwards from the final stage of the game. It involves analyzing the possible outcomes and payoffs at each decision node, considering the rationality of each player, and selecting the best course of action at each stage. By iteratively applying backward induction, the equilibrium outcome of the game can be determined.