Typed plzzz... Asap Fred wants to hire Barney to manage his retail store. Barney can apply a high level ofeffort (at a cost to him of $30), a medium level of effort (at a cost to him of $10), or alow level of effort (at a cost to him of $0). Fred's profits depend not only on the levelof Barney's effort but also on the state of consumer demand. Fred believes thatdemand will be high with probability 50 percent (and therefore demand will be lowwith probability 50 percent). Fred has determined the following possible profit levels(before paying Barney) will occur depending on Barney's effort and the state ofconsumer demand:effortDemandlowlow20medium 40high 80Of the choices below, what is the largest percentage range of profit provided toBarney that would ensure Barney would supply high effort?any percent greater than 50.00 percent (1/2).any percent greater than 75.00 percent (3/4).any percent greater than 66.66 percent (2/3).high4080100any percent greater than 83.33 percent (5/6).

p=0.5 1-p=0.5 Expected revenue low(demand) high(demand) Cost associated with Profit…

Answered: effort low medium high Demand low 20 40…

Business

Economics

effort low medium high Demand low 20 40 80 high 40 80 100

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter6: Demand Relationships Among Goods

Section: Chapter Questions

Problem 6.14P

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