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Consider the same two-person household as in Question 1. Let the household members use a Nash bargaining protocol to determine labor supplies in the household.

Consider the same two-person household as in Question 1. Let the household members use a Nash bargaining protocol to determine labor supplies in the household. Namely, let the value of the "outside option" of individual be given by Then labor supplies are given by the solution to max 12 (1(1 2) 1) 05 (2(1 2) 2) 05 1. Find the labor supplies 1 and 2 when is equal to the utility level of individual for the case that the household behaves noncooperatively (i.e., in the noncooperative Nash equilibrium you solved for in Question 1.1).

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