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1. (2 marks for each part) Wright et al. assume the matching technology in their model is like the standard neoclassical production function increasing, concave

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1. (2 marks for each part) Wright et al. assume the matching technology in their model is like the standard neoclassical production function increasing, concave and with constant returns to scale. ,u(nb,ns) is the number of meetings that occur given m, buyers and 71, sellers. They denote the probability that a seller meets a buyer by oz(n), where n = nbs. (i) Derive the a function from the a function. (ii) Prove that the probability that a buyer meets a seller is a(n). (iii) Wright assumes that 01(0) = 0, oz'(n) > 0, 0:\"(71)

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