Two workers independently choose how much effort to put in their jobs. If worker 1 chooses e₁ ≥ 0 and worker 2 chooses e₂ ≥ 0, their payoffs are given by u₁(e1, €2,01,02) = 0101 + ße1e2− −e² 2 u₁(e₁, €2,01,0₂) = 0₂e2+ Be₁ €2-1/2e2²2 where 0 <ß < 1 and 0 ≤ 0; ≤ 1 for i = 1,2. Assume that 0; is player i̇'s private information: each player knows her own and believes that the other player's is drawn from the uniform distribution over [0, 1]. Find the Bayesian Nash equilibria of this game
Q: Suppose a monopoly can sell 1 unit for $20, or 2 units for $15 each. What is the marginal revenue…
A: We know that: Total Revenue = Price*Quantity Marginal Revenue = TRn+1 - TRn Where TR = Total Revenue…
Q: Which of the following is NOT an undesirable side-effect of discretionary fiscal policy? A)…
A: Meaning of Macroeconomics: The term macroeconomics refers to the situation of economic and…
Q: The bank is paying 11.29% compounded annually. The inflation is expected to be 12.22% per year. What…
A: When talking about market interest rate, it is the rate at which people are ready to exchange money…
Q: monopolist sells boat insurance policies linked to their registrations in two states, and resales…
A: DISCLAIMER “Since you have asked multiple question, we will solve the first three question for you.…
Q: Draw an optimal consumption bundle which represents that consumers are willing to pay a greater…
A: The optimal consumption bundle is a collection of items that fit within a budget and provides the…
Q: Question #2: Consider the accompanying cash flow series at an interest rate = 10%. What is the…
A: The representation of cash flow refers to the net amount of cash and cash equivalents existing…
Q: An economy has a fixed price level, no imports and no income taxes. MPC is 0.75 and real GDP is…
A: Given MPC= 0.75 Real GDP Y =$190 billion Government expenditure is increased by $5 billion. Price…
Q: the competition price? Assume all other things are equal, of course, or a comparison is meaningless…
A: In monopoly, there is a single firm producing unique good while in perfect competition, there are…
Q: Economic conditions Investment Good Normal Bad A $10,000 $5000 $0 B 6000 4000 1000 C 4000 2000 1500…
A: We required to computed the probabilities of 3 economic conditions such that there is no difference…
Q: Answer 2 please
A: Perfect competition is a type of market structure.
Q: Which statement is true? a. Outsourcing is often helpful when a single firm does not achieve…
A: When talking about outsourcing, it can be said that it is the interaction between two business firms…
Q: Question #1: Consider the accompanying cash flow series at varying interest rates. What is the…
A: Here as seen in the flow chart P = 1200/1.04 + 1800 * 1/1.06 * 1/1.04 + 1200 * 1/1.08 * 1/1.06 *…
Q: MODIFIED TRUE OR FALSE Take-off stage of growth begins when industrial or manufacturing society…
A: Meaning of Economics: The term economics refers to the situation under which there remain…
Q: Describe how the Great Recession affected the balance sheets of the central bank and the banking…
A: Between 2007 and 2009, the Great Recession was a period of substantial-overall deterioration…
Q: Question 2 The volatility of short-term economic growth gives rise to O the balance of payments. O…
A: Economic growth is the gross domestic product of an economy. The higher gross domestic product…
Q: In the short run, a firm's output level is 10 units. Its total cost is $4000 and its average fixed…
A: Cost of production refers to the amount of money involved in the production of goods and services,…
Q: DIFFERENCE BETWEEN perfect ompetetion , monopoly and oligopoly
A: The Market is a place where the buyers and the sellers interact to purchase or sale a specific…
Q: During the 2012 fiscal year, households in an economy spent 80 per cent of their disposable income…
A: Since you have asked a question with multiple sub-parts, we will solve the first three sub-parts for…
Q: The law of diminishing marginal utility allows us to conclude that A) demand curves slope downward…
A: Law of diminishing marginal utility states that as we consume more and more units of a commodity…
Q: How much total profit will the firm make at the profit-maximising level of output? A) £40 B) £16…
A: Quantity AC MC AR MR 100 3.20 3.00 3.00 3.00 200 2.80 2.80 3.00 3.00 300 2.84 3.00 3.00 3.00…
Q: Modified True or False The Lewis Theory of Economic Development assumed two distinct sectors,…
A: Arthur Lewis gave his theory on economic development under which he stated that the surplus labour…
Q: What is the true cost of going to the doctor? Question 7 options: The amount you pay minus the…
A: Fees paid to the doctors is paid partly by people and partly by insurance company.
Q: How does a rise in taxes influence the MP Curve and IS Curve? Please illustrate your answer using…
A: MP curve shifts when Monetary policy changes but here the Tax has increased which means it will…
Q: Below is a symbol found in most products. Discuss how this symbol talks about the social…
A: To be eco-friendly is today's way to build and need at the same time. The companies are now…
Q: Suppose that in a small town in July, the price of a loaf of bread was $2.50 and 1700 loaves were…
A: In August Price = 2.50 Quantity = 1700 In August Price = 2.29 Quantity = 1500
Q: A new machine was installed by a company at a total cost of 145,000 and projected to have a useful…
A: Given capital cost = 145000 Salvage value = 14500 Annual rate of interest = 18 % time = 15 years
Q: Sweden and Norway are two neighboring countries in Northern Europe with similar savings rates,…
A: The Solow–Swan model, sometimes known as the exogenous growth model, is a long-run economic growth…
Q: Supposed the economy is faced with persistently rising prices and there is a real threat of a…
A: The LM curve shows the direct relationship between the interest rate and output. The LM curve is…
Q: what happens to the natural rate of unemployment in response to the following events? Explain 1. the…
A: Natural Rate of Unemployment: The natural rate of unemployment can be defined as the the lowest…
Q: Differentiate the equation of demand for real money balances inthe Keynesian model based on the LFT…
A: Keynesian model of the demand for real money balances and the classical model of demand for real…
Q: What is the definition of Property tax
A: Taxes are defined as a tax levied by the government on individuals in the economy in exchange for no…
Q: So tell the future calculated worth analysis to decide whuch a or b will be good to be purchased?
A:
Q: The consumption function is given by: C = 200+0.75 (Y-T). The investment function is I = 200-25r.…
A: The curve that depicts various interest rate and income combinations for which demand for money is…
Q: If the central bank raises interest rates it will A) lower aggregate demand and raise the…
A: " Aggregate demand reflects the relationship between price level and total number of all the final…
Q: Differentiate between economic growth and economic development.
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
Q: How do the strategic asset allocations of investors with and without income from labour differ?
A: Labor is an input that is used to produce the goods and services into an economy. It means the labor…
Q: What are the guidelines that SBA has developed for the various industries?
A: Introduction The SBA or Small Business Administration's guidance materials give vital background on…
Q: 3. Suppose Product X is a normal good and its price (Px) decreases. Graphically illustrate its…
A: Normal goods are those goods whose demand and income moves in same direction. If income rise then…
Q: Which of the following is likely to have the highest (in absolute value) demand elasticity?…
A: The measure that depicts the change in quantity demanded of a product or service with respect to…
Q: advertisement of an investment firm states that if you invest $500 in their firm today you will get…
A: the niminal interest rate or noninal rate of interest is both of two particular things: the pace of…
Q: Definitions and Explanations: Define, Compare and Contrast -Soft Money v. Hard Money
A: Soft money and hard money are used to define different kinds of currency in Economics. Soft currency…
Q: The classical school of economics believe that consumers and producers are rational Is it True or…
A: In certain the value of the Classical theory is generally the self regulations of the economy and it…
Q: If P10,000 is deposited each year for 9 years, how much annuity can a person get semi-annually from…
A: In this question:- P10,000 is deposited each year time=9 years Cost of money is 14% compounded…
Q: An incumbent firm Pilly has a product that works well but has the possibility of causing…
A: We have game between two players, they both have same set of actions invest and don't invest.
Q: de information to help students decide which 2-year degree program they s director has set up the…
A: *Answer:
Q: Graph B.5. shows the economics ac following questions Graph B.5 P S Ps Ps P₂ P₁ К D₂ Q Q₁ Q₂ Q₂ a)…
A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…
Q: A political pollster wants to ensure that their poll on attitudes toward separation of church and…
A: Here use basic definition of cluster sampling and frequency Cluster sampling : here population…
Q: The bank is paying 10.12%, compounded annually. The inflation is expected to be 9.32% per year. What…
A: market intrest rate is also known as real intrest rate. Market intrest rate = Nominal Intrest rate +…
Q: Q2. Determine the returns to scale of the following production function: Hand written plzz Y = 5K0.5…
A: Y=5K0.5+3L0.5Y=f(K, L)=5K0.5+3L0.5Now,f(tK, tL)=5(tK0.5)+3(tL0.5)…
Step by step
Solved in 2 steps
- There is a project for which player 1 can exert effort e ≥ 0 that costs her c(e) = 0.5e2. If player 1 and player 2 can come to an agreement, then a total value of v(e) = e is produced, which can be allocated between the two players. Effort also produces a value y(e) = ke, where k = [0, 1], that player 1 can obtain for herself if player 1 and 2 fail to agree. The game has three stages: (I stage) Player 1 chooses effort e ≥ 0; (II Stage) Player 2 observes e and chooses and effort level a € [0, 1]; (III stage) Player 1 observes a and either agrees (a) or rejects (r) the offer. If player 1 accepts the offer, then her payoff is ae - 0.5e² and player 2's payoff (1 − a)e. If she rejects the offer, then player 1's payoff is ke - 0.5e² and player 2's payoff is zero. • What is the subgame perfect equilibrium effort choice? •Suppose that player 2 can choose k = [0, 1] before the above game is played. What would he choose? What would be the equilibrium effort? Suppose now that the government,…Consider the following ‘war of attrition’. Two animals are in a stand off for a prey. Theyindependently decide when to give up. Waiting is costly, but the animal giving up last winsthe prey (they each get nothing if they walk away at the exact same time). Getting the preygives a benefit of 80 while waiting costs 2 per unit of time. Formally payoffs are given asfollows:u1(t1, t2) =(−2t1 if t1 ≤ t280 − 2t2 if t1 > t2u2(t1, t2) =(80 − 2t1 if t1 < t2−2t2 if t1 ≥ t2,where ti is the amount of time animal i decided to wait. Assuming that animals aim tomaximize payoffs (consciously or not), figure out the Nash equilibria of this game by answeringthe following questions (similar to how we proceeded to solve the Bertrand game).(a) Show that there is no Nash equilibrium where both animals wait a strictly positiveamount of time. For this, consider two subcases: (i) both wait the same amount oftime, or (ii) one gives in earlier than the other.(b) Assume now that one animal, say the first one,…A total of 10 players are each choosing a number from {0,1,2,3,4,5,6,7,8}. If a player's number equals exactly half of the average of the numbers submitted by the other nine players, then she is paid $100; otherwise, she is paid 0. Solve for the strategies that survive the IDSDS.
- Assume a firm located in a non-urban location pays a wage of $34/hour. However, it is assumed that there is a 20% chance that workers incur "switching costs" of $14/h. a) what is the expected wage? b) If a firm in an urban cluster wants to match the expected wage (and all else is equal), what should it pay assuming that urban switching cost is only $10 and the chance that switching is necessary is only 10%.Two partners start a business. Each has two possible strategies, spend full time or secretly take a second job and spend only part time on the business. Any profits that the business makes will be split equally between the two partners, regardless of whether they work full time or part time for the business. If a partner takes a second job, he will earn $20,000 from this job plus his share of profits from the business. If he spends full time on the business, his only source of income is his share of profits from this business. If both partners spend full time on the business, total profits will be $200,000. If one partner spends full time on the business and the other takes a second job, the business profits will be $80,000. If both partners take second job, the total business profits are $20,000. a) This game has no pure strategy Nash equilibria, but has a mixed strategy equilibrium. b) This game has two Nash equilibria, one in which each partner has an income of $100,000 and one in…There are two students, each of whom can choose to plant flowers (F) or not to plant flowers (N). If both students plant flowers, then the (flower appreciation) benefit is 120 to each player. If exactly one student plants flowers, then the benefit is 65 to each player. The cost to either player of planting flowers is c > 0, regardless of the other player's choice. Each student starts (before any costs or benefits) with a payoff of zero. The above assumptions lead to the following game in strategic form. F N 120 – c, 120 – c 65 — с, 65 65, 65 — с 0,0 Suppose thatc< 120. This game is a prisoners' dilemma if and only if the parameter c is strictly greater than which value?
- A cake valued at $90 is divided among five players (P1, P2, P3, P4, P5) using the last diminisher method. The players play in a fixed order, with P1 first, P2 second, and so on. In round 1, P1 makes the first cut and makes a claim on a C-piece. For each of the remaining players, the value of the current C-piece at the time it is their turn is given in the following table: Player 2 Value of current C-piece $19.00 O a Player 3 $17.50 Which player gets his or her share at the end of round 1 and round 2? What is the value of the share to the players receiving the share? Ob O c Od Player 4 $15.00 Round 1: Player 2, approximate value $19.00 Round 2: Player 5, value $18.00 Round 1: Player 5, value $18.00 Round 2: Player 2, value $18.00 Round 1: Player 2, approximate value $19.00 Round 2: Player 5, value $18.00 Round 1: Player 5, approximate value $19.50 Round 2: Player 2, value $18.00 Player 5 $19.50A cake valued at $40 is divided among five players (P1, P2, P3, P4, P5) using the last diminisher method. The players play in a fixed order, with P1 first, P2 second, and so on. In round 1, P1 makes the first cut and makes a claim on a C-piece. For each of the remaining players, the value of the current C-piece at the time it is their turn is given in the following table: Player 2 Player 3 Player 4 Player 5 Value of current C-piece $5.50 $8.75 $6.50 $9.00 Which player gets his or her share at the end of round 1 and round 2? What is the value of the share to the players receiving the share? Round 1: Player 3, value $8.00 Round 2: Player 5, value $9.00 Round 1: Player 5, approximate value $9.00 Round 2: Player 3, value $8.75 Round 1: Player 5, approximate value $9.00 Round 2: Player 3, value $8.00 Round 1: Player 4, approximate value $6.50 Round 2: Player 3, value $8.00 a C dSuppose that the expected value of weekly profits for an ice cream shop, before paying the manager, Amy, is where e is Amy's weekly overtime hours. Amy is risk-neutral but incurs a cost for working overtime. Thus, total expected surplus is What level of effort maximizes total surplus? The value of overtime that maximizes total surplus is e = hours. (Enter your response rounded to one decimal place.) E(л) = 500 + 9e, C(e) = e² E(S)=E(¹) - C(e).
- Suppose that • The employee has an outside offer to work for $27 per hour, for 1500 hours per year The employee currently works for $20 per hour, for 2000 hours per year The switching cost can be either high ($1'000) or low ($50) • The high switching cost has probability 40%; the low switching cost 60% Suppose that the cost of losing the employee is $800. What is the employer expected payoff from choosing not to match the outside offer?Suppose that the expected value of weekly profits for an ice cream shop, before paying the manager, Amy, is where e is Amy's weekly avertime hours. Amy is risk-neutral but incurs a cost for working overtime. Thus, tatal expected surplus is What level of effort maximizes total surplus? The value of overtime that maximizes total surplus is e-hours. (Enter your response rounded to one decimal place.) E(x)=500+10c C(e)=² E(S)-[(x)-C(e).Reactors `R’ Us operates a nuclear power plant in Potsdam.In the event of reactor failure, there would be major damages to the North Country. The company can reduce the probability of failure through proper maintenance of the facility. The marginal cost of maintenance is increasing in the amount of maintenance done (and thus decreasing in the probability of an accident). We can write this marginal cost curve as MAC=2-10p (where 0<p<1, and represents the probability of a failure over a 50 year period). The marginal expected damages are an increasing function of the probability of an accident so that MD=2.2+10p. Provide a graph or graphs to illustrate your analysis/answers to the following questions. A. What is the efficient probability of reactor failure? B. If “Reactors ‘R’ Us” thinks that, in the event of reactor failure, they will NOT be found liable for damages, what probability of failure will they choose? C. If “Reactors ‘R’ Us” thinks that, in the…