As more people started using smart phones, the number of smart phone applications available rose, increasing the smart phone's value to those who already owned one. This is an example of a(n) ________

A subgame perfect Nash equilibrium

A) can be solved by backward induction. B) is a set of strategies that are a Nash equilibrium in every subgame. C) is a stronger form of Nash equilibrium. D) All of the above are correct.

Which of the following illustrates the effectiveness lag?

A) Policymakers believe an economic downturn has occurred, but they decide not to take action until they are sure. B) Policymakers are in the process of proposing policy measures to deal with the current economic slowdown. C) Policymakers first learn of the recession when it is five months old. D) Policymakers implement policy X, but it will be a few months before it starts working. E) Policymakers agree to policy X, but it will be at least two months before the policy is implemented.