Consider the following: . Recently there have been reports of generic iPhone chargers catching on fire and causing injury. As a result, the courts are deciding whether to force the manufacturers of these iPhone chargers to bear the risk or have the consumers of the chargers bear the risk. o The likelihood of a charger catching on fire is 10% and the cost of the damages to the consumer is $500. . Suppose both the manufacturers and consumers are risk neutral (where manufacturers are the suppliers and consumers are the demanders). If the courts are looking to maximize efficiency (i.e. have the largest quantity in the market), who should they require to bear the risk? The manufacturers. The consumers. It doesn't matter--quantity is always the same regardless of who bears the risk. Impossible to tell from the information given