Consider the same setup with the curved final exam as in the previous question. Now suppose the students move sequentially. Which best describes the outcome in the subgame-perfect equilibrium?
a. Brainiacs study and Numbskulls party regardless of who moves first.
b. Brainiacs party and Numbskulls study regardless of who moves first.
c. The party moving first studies.
d. The party moving first parties.
Question 2
Fuchs (1988) static model of cost savings provides little encouragement for the prospects of savings in medical care. He concludes our best chance for controlling costs may be
a. to limit input prices.
b. to improve efficiency in the production of medical care.
c. to reduce medical care utilization.
d. to increase the use of low-priced inputs and reduce the use of high-priced inputs.
e. all of the above are necessary according to Fuchs.
