Suppose that there is a civil case against a defendant. The

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Suppose that there is a civil case against a defendant. The probability of the plaintiff winning is fixed at p=0. 5. The damages are given by V(CP ,CD)=6+6 ln(CP +1)−6 ln(CD +1). Find the optimal legal expenditure es under an American-style legal fee system. For what amount would the defendant agree to settle?

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