7. A firm chooses to produce either a HIGH quality or a LOW quality version of its product. The marginal costs are respectively, $10 and $1. A consumer has a reservation price for the high quality version of $30, and $10 for the low quality. The firm informs the consumer that the product is high quality and charges a price of $20. Not being able to independently determine before purchase the true quality, the consumer must choose either to BUY or DON'T buy the product. Listed below are the consumer and producer surplus based on these numbers. Consumer Firm's Consumer Producer Quality Surplus Surplus BUY HIGH $10 $10 BUY LOW -10 19 DON'T HIGH 0 -10 DON'T LOW 0 -1 a. Suppose the firm must choose HIGH or LOW before receiving the consumer's order. Set up a payoff matrix based on the numbers in the table and solve the game using appropriate game theory techniques. (Place the consumer's strategies on the rows and the producer's on the columns.) Briefly explain how you obtained your answer. Note: this is a one-period simultaneous move game. (6 pt.) b. Suppose the firm allows the consumer to return the merchandise for a full refund if not satisfied. How does this change the payoff matrix and the predicted game outcome? (6 pt:)