Objective functions 400.00 300.00 200.00 100.00 0.00 2,5 -100.00 -200.00 -300.00 -E(ys)-E(YR) -E(NS) -E(NR) E(YS)= 100-100i E(YR)-100-50i E(IIS)= -20 +100i E(IIR)= -70 +50i Assuming we are under monopoly and asymmetric information, what is the highest interest for which both types (safe and risky) stay in the market? O i-2 O i-0.5 O i-1 Oi-3 O 0.5 3.5

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
400.00
300.00
200.00
100.00
0.00
2.5
-100.00
-200.00
-300.00
-E(ys)E(YR)
-E(NS)
E(NR)
E(YS) 100-100i
E(YR)=100-50i
E(IIS) -20 +100i
E(IIR)= -70 +50i
Assuming we are under monopoly and asymmetric information, what is the highest interest for
which both types (safe and risky) stay in the market?
Oi-2
Oi-0.5
O i-1
Oi-3
0
Objective functions
0.5
3.5
Transcribed Image Text:400.00 300.00 200.00 100.00 0.00 2.5 -100.00 -200.00 -300.00 -E(ys)E(YR) -E(NS) E(NR) E(YS) 100-100i E(YR)=100-50i E(IIS) -20 +100i E(IIR)= -70 +50i Assuming we are under monopoly and asymmetric information, what is the highest interest for which both types (safe and risky) stay in the market? Oi-2 Oi-0.5 O i-1 Oi-3 0 Objective functions 0.5 3.5
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