PLEASE HELP

Instruction: Please write your answers on paper using a pen/pencil (use black ink and make sure it is legible). 2. Suppose there is a budget deficit. It can be reduced by cutting military spending, by cutting welfare programs, or by cutting both. The Democrats haveutuq decide whether to support cuts in welfare programs. The Republicans hayetg decide whether to support cuts in military spending. The possible outcomes are represented in the following table: Welfare Cuts Yes No Defense Yes (R = 1, D = 2) (R = 2, D = 3) Cuts No (R=3, D=2) (R=1, D=1) The table presents payoffs to each party under the various outcomes. For example: if Democrats vote for welfare cuts, and Republicans vote against cuts in military spending, the Republicans receives a payoff of 3, and the Democrats receive a payoff of -2. a. If the Republicans decide to cut military spending, what is the best response of the Democrats? Given this response, what is the payoff for the Republicans? b. If the Republicans decide not to cut military spending, what is the best response of the Democrats? Given this response, what is the payoff for the Republicans? c. Based on your answers from parts a and b, what will the Republicans do? What will the Democrats do? Will the budget deficit be reduced? Why or why not? Is there a better outcome for both parties