consider what would happen if the civil society was sufficiently strong that it would respond to repression by the soft-liners with an armed insurgency. Also consider what would happen if both actors considered facing an armed insurgency to be the worst possible outcome. (See Figure 2.)
Figure 2: Soft-liner Elite Confronts a Strong Civil Society
-What is the subgame perfect equilibrium to this game?
Definitions:
Average Variable Costs
The total variable costs divided by the number of units produced, representing the variable cost per unit of output.
Total Variable Cost
The total of all costs that vary with output level in the short run.
Output
The total amount of goods or services produced by a company, industry, or economy within a specific period.
Total Cost
The aggregate cost of producing a given level of output, including both fixed and variable costs.
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