Price rigidity, collusion, and booms. (This follows Rotemberg and Saloner 1986.) Suppose that a sector, with N firms, faces the demand function, p = e - bq, where e is Li.d. and uniform on [0, IJ. The marginal cost of production is equal to zero. 

(a) Suppose that the N firms collude to achieve the monopoly outcome. Determine the monopoly price and quantity (assuming that prices are set after e is realized). 

(b) Determine the profit of each firm if the sector behaves as a monopolist. 

(c) What is the relation between e and the incentive to cheat, that is, the incentive for any of the N firms to post a price e lower than the others?

10 0/3 points awarded Scored Problem 5-3A (Algo) The following employees of CIBA Ironworks in Bristol, Illinois, are paid in different frequencies. Some employees have union dues or garnishments deducted from their pay. Use Figure 5.4. Required: Calculate their net pay using the Wage Bracket Method when possible, and the Percentage Method when the amount earned exceeds the Wage Bracket Tables for Income Tax Withholding in Appendix C, and including Illinois income tax of 4.95 percent of taxable pay. No employee has exceeded the maximum FICA limits. You do not need to complete the number of hours. (Round your intermediate calculations and final answers to 2 decimal places.) Employee C. Whaley F. Paguaga K. Harvey L. Bolling Frequency Weekly Semi- monthly Monthly Biweekly Marital Status/ Withholdings M, 2 M, 2 S. 3 M. 0 Pay $ 970 $ 2,920 $ 7,400 $ 2,620 Union Dues per Period $ 90 $ 300 Garnishment per Period $ $ $ 97 $ $ 105 $ 160 $ Net Pay 873.00 X 2,830.00 X 6,995.00 X 2,460.00x