5. Individual Problems 15-5 Every year, management and labor renegotiate a new employment contract by sending their proposals to an arbitrator, who chooses the best proposal (effectively giving one side or the other $5 million). Each side can choose to hire, or not hire, an expensive labor lawyer (at a cost of $100,000) who Is effective at preparing the proposal in the best light. If neither hires a lawyer or if both hire lawyers, each side can expect to win about half the time. If . only one side hires a lawyer, it can expect to win three fourth, or 0.75, of the time. Use the given information to fill in the expected payoff, in dollars, for each cell in the matrix. (Hint: To find the expected payoff, multiply the probability of winning by the dollar amount of the payoff. Be sure to account for lawyer costs, which are incurred with certainty if a lawyer is hired.) Management (M) No Lawyer Lawyer Labor (L) No Lawyer L: $ M: S L: $ M: $ Lawyer L: $ M: S L: $ M: $ The Nash equilibrium for this game is for Management to a lawyer, and for Labor to a lawyer. Grade It Now Save & Continue