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

question 15

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 losing $200 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)if 15 < H < 20.
• B)if 15 < H < 40.
• C)for all positive values of H.
• D)only in the limit as H approaches infinity.
• E)if 12.50 < H < 16.67.

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Definitions:

Highbrow Tastes

Preferences for cultural products, activities, or interests considered intellectual, sophisticated, or of high quality.

Literature

Written works considered to have artistic or intellectual value, including fiction, poetry, drama, and essays.

Comprehensive

Describing something as fully inclusive or encompassing all necessary elements, parts, or aspects.

Childcare

The care and supervision of a child or multiple children, typically from ages six weeks to thirteen years, by a person other than the child's legal guardians.