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For questions (20-26), consider the following scenario: Consider a two-hospital town with two hospitals named Hospital A and Hospital B. Both hospitals are considering a
For questions (20-26), consider the following scenario: Consider a two-hospital town with two hospitals named Hospital A and Hospital B. Both hospitals are considering a new imaging machine to attract more patients. The population of the town is small enough that it really only needs one of these machines. Purchasing a machine costs $1,200. If both hospitals install a machine, each earns $900 in revenue. If only one hospital installs a machine, that hospital earns $2000 in revenue. The other hospital loses $500 as patients switch to other hospital. If neither hospital installs a machine, then revenue does not change for either one. (And prots are $0 if neither hospital installs a machine.) 20. (2 pts) Consider Hospital A's decision to buy one of those machines. A's prots will depend on what B decides to do. Suppose hospital B buys a machine. How much will A earn if it also decides to buy a machine? 21. (2 pts) Suppose hospital B buys a machine. How much will A earn if it does not buy the machine? 22. (2 pts} Should hospital A buy the machine if hospital B buys the machine? 23. (2 pts} If hospital B does not buy the machine but hospital A does, how much will hospital A earn? 24. (2 pts} If neither hospital buys the machine, how much will Hospital A earn? 25. (2 pts} Should Hospital A buy the machine if hospital B does not buy the machine
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