Suppose That in Enigma, Ohio, Klutzes Have a Productivity of $1,000

question 18

Multiple Choice

Suppose that in Enigma, Ohio, klutzes have a productivity of $1,000 and kandos have a productivity of $4,000 per month. You can't tell klutzes from kandos by looking at them or asking them, and it is too expensive to monitor individual productivity. Kandos, however, have more patience than klutzes. Listening to an hour of dull lectures is as bad as losing $300 for a klutz and $150 for a kando. There will be a separating equilibrium in which anybody who attends a course of H hours of lectures is paid $4,000 per month and anybody who does not is paid $1,000 per month

• A) for all positive values of H.
• B) if 10 < H < 40.
• C) if 10 < H < 20.
• D) only in the limit as H approaches infinity.
• E) if 8.33 < H < 16.67.

---

Definitions:

Casual Affairs

Relationships or encounters that are sexual in nature but not considered serious or committed.

Social Groups

Collections of individuals defined by shared interests or characteristics, forming a basic unit of social organization.

Cohabitation

The state of living together and having a sexual relationship without being married.

Concubinage

A relationship where a person cohabits with another without being legally married, historically often recognized in various cultures for secondary partners.