econ homework

Econ 402: Decision Making and Strategy in Economics

Fall 2016: Assignment 5

Instructions

1. Answers should be succinct and precise. Type if possible (at the least the non-math part) and/or

write legibly.

2. You can consult each other/work in groups, but copying in any way will be heavy penalized. The

university has very strict regulations against it.

3. You must hand in the answers at the beginning of class on Thursday, November 17. If for some

reason you are unable to attend class, please send the assignment through a classmate.

Problem 1 [25 points]

Exercise 11 in Chapter 22 (on page 310) of the textbook. Note efficient level means the effort level that

maximizes the sum total of the manager and worker’s utility: 4a – a2.

Problem 2 [25 points]

Exercise 1 in Chapter 18 (on page 241) of the textbook.

Problem 3 [25 points]

Exercise 7 in Chapter 18 (on page 242) of the textbook.

Problem 4 [25 points]

Exercise 6 in Chapter 19 (on page 257) of the textbook.