Return to the lemons game in section 11.3, and consider the same structure, except suppose there are just two quality levels: low and high. the buyer initially assigns probability q to a car’s being of high quality and probability 1 - q to its being of low quality. if the seller sells the car, then her payoff is the price the buyer paid. if the car is not sold, assume that it is worth $10,000 to the seller if it is of high quality and $6,000 if it is of low quality; those are the payoffs. the value of the car to the buyer is $12,000 if it is of high quality and $7,000 if it is of low quality. if the buyer purchases the car, then the buyer’s payoff is the car’s value—which is $12,000 or $7,000—less the price paid; his payoff is zero if he does not buy the car. find values for q such that there is a pbne with pooling.

An office manager is concerned with declining productivity. despite the fact that she regularly monitors her clerical staff four times each day—at 9: 00 am, 11: 00 am, 1: 00 pm, and again at 3: 00 pm—office productivity has declined 30 percent since she assumed the helm one year ago. would you recommend that the office manager invest more time monitoring the productivity of her clerical staff? explain.

At a student café, there are equal numbers of two types of customers with the following values. the café owner cannot distinguish between the two types of students because many students without early classes arrive early anyway (i.e., she cannot price-discriminate). students with early classes students without early classes coffee 70 60 banana 51 101 the marginal cost of coffee is 10 and the marginal cost of a banana is 40. the café owner is considering three pricing strategies: 1. mixed bundling: price bundle of coffee and a banana for 161, or just a coffee for 70. 2. price separately: offer coffee at 60, price a banana at 101. 3. bundle only: coffee and a banana for 121. do not offer goods separately. assume that if the price of an item or bundle is no more than exactly equal to a student's willingness to pay, then the student will purchase the item or bundle. for simplicity, assume there is just one student with an early class, and one student without an early class. price strategy revenue from pricing strategy cost from pricing strategy profit from pricing strategy 1. mixed bundling $ $ $ 2. price separately $ $ $ 3. bundle only $ $ $ pricing strategy yields the highest profit for the café owner.

Compare the sources of consumer credit(there's not just one answer)1. consumers use a prearranged loan using special checks2. consumers use cards with no interest and non -revolving balances3. consumers pay off debt and credit is automatically renewed4. consumers take out a loan with a repayment date and have a specific purposea. travel and entertainment creditb. revolving check creditc. closed-end creditd. revolving credit