transect. We now assume that Y i is a random variable having a Poisson distribution Po( λ L i ), where the parameter λ has a
specific meaning of encounter rate of dolphins per nautical mile. For estimating the parameter of interest λ , we propose the following type of estimator,
p and 2 with probability 1 − p. There are two firms that play a Bertrand wage bidding game for the services of the worker, which simplifies wage determination: the equilibrium wage becomes the expected marginal value product of the worker. (a) Show that there is a separating PBE in which type 1 does not signal and type
M P 1 : max
q≥0 p(q)q − c(q).
where p(q)q is a revenue and c(q) is a cost when the output is fixed to q. Let π(q) = p(q)q − c(q) denote the revenue function. Assume that the firm’s objective function π(q) is convex and differentiable. Then, the first order condition is:
Two players, 1 and 2, each own a house. Each player i values her own house at v i
and this is private information. The value of player i’s house to the other player j(6= i) is 32 v i . The values v i are drawn independently from the interval [0, 1] with uniform distribution. Suppose players announce simultaneously whether they want to exchange (E) their house of not (N). If both players agree to an exchange, the exchange takes place. Otherwise no exchange occurs.