Use the following to answer questions 20 to 30: Consider the following setting of bilateral precaution. Cyclists who ride at night can reduce the risk of getting hit by a car by wearing reflective vests. Drivers can reduce the risk of hitting a bicyclist by installing HID (High Intensity Discharge) headlights, which are brighter than normal headlights. Imagine there's only one driver and one bicyclist, and the likelihood of an accident is as follows: Driver Precaution Normal Headlights HID Headlights Cyclist Precaution No Vest 3% 3% Vest 5% 1% The damage done by an accident is $1,000, and compensation is perfect. Reflective vests cost $15, and HID bulbs cost $30. There is no insurance - drivers bear their own liability costs. 20) Will the cyclist invest in a reflective vest? A) Yes - but only if the driver has normal headlights installed B) Yes - but only if the driver has HID headlights installed C) Yes - regardless of what the driver's action is D) No - regardless of what the driver's action is Answer: C 21) Will the driver invest in HID headlights? A) Yes - but only if the cyclist has a vest on B) Yes - but only if the cyclist does not have a vest on C) Yes - regardless of what the cyclist's action is D) No - regardless of what the cyclist's action is Answer: C 22) What is the efficient level of precaution by both sides? A) Cyclist: vest; Driver: normal headlights B) Cyclist: vest; Driver: HID headlights C) Cyclist: no vest; Driver: normal headlights D) Cyclist: no vest; Driver: HID headlights Answer: B