Again assuming that Century 21 agents receive base salaries of $12,000 and 50% of the commissions earned, while RE/MAX agents pay a yearly $18,000 and receive 100% of the commissions earned:

1. Suppose there are two types of real estate agents: (1) risk-averse agents who are very averse to volatility in their annual compensation; (2) less risk-averse agents who can handle the inherent swings in real estate markets.

Assuming that each type expects to earn total commissions averaging $60,000, which types of agents will be attracted to Century 21, and which to RE/MAX?