Part D (1 marks) Switch characters: You hear an alert on your phone, you grab it and see in your group chat that one of your friends has just texted a cockamamie story about seeing an alien spacecraft landing in the woods with green martians and other nonsense. There are four of you in the group chat. The others have known each other since childhood, but you are new to the group having only met them this year in the University residence. No one has replied to the message yet. You're supposed to meet with this friend in about 3 hours to prepare for your advanced physics final exam. You don't know what to think. This is a very important exam and it's essential to study with someone who you can count on to be serious and focused. Concerned, you decide to cancel the study plans and make new plans with a different friend who is weaker at the subject, but who you can at least count on to be firmly planted in reality. What informational problem best describes the source of the market failure described above? Part E (2 mark) Consider the following extensive form, sequential game: Keep plans 4,2 Friend 2 Share story Cancel 2,3 3,4 Friend 1 Keep it to yourself Friend 2 Keep plans Cancel 1,1 Find the equilibrium of this game. What are the payoffs at the equilibrium? Part F (1 mark) Your friend calls you and promises to be serious and focused during the study session. You are hesitant but you decide to give them the benefit of the doubt. You meet, sit, open your textbooks, pen in hand, and immediately they start to ramble on about alien abductions, extra-terrestrial space travel, area 51, and other absurdities. Nothing you can do will get them to stop yapping on and get to work. You barely get any studying done. What informational problem best describes the source of the market failure described above? Part D (1 marks) Switch characters: You hear an alert on your phone, you grab it and see in your group chat that one of your friends has just texted a cockamamie story about seeing an alien spacecraft landing in the woods with green martians and other nonsense. There are four of you in the group chat. The others have known each other since childhood, but you are new to the group having only met them this year in the University residence. No one has replied to the message yet. You're supposed to meet with this friend in about 3 hours to prepare for your advanced physics final exam. You don't know what to think. This is a very important exam and it's essential to study with someone who you can count on to be serious and focused. Concerned, you decide to cancel the study plans and make new plans with a different friend who is weaker at the subject, but who you can at least count on to be firmly planted in reality. What informational problem best describes the source of the market failure described above? Part E (2 mark) Consider the following extensive form, sequential game: Keep plans 4,2 Friend 2 Share story Cancel 2,3 3,4 Friend 1 Keep it to yourself Friend 2 Keep plans Cancel 1,1 Find the equilibrium of this game. What are the payoffs at the equilibrium? Part F (1 mark) Your friend calls you and promises to be serious and focused during the study session. You are hesitant but you decide to give them the benefit of the doubt. You meet, sit, open your textbooks, pen in hand, and immediately they start to ramble on about alien abductions, extra-terrestrial space travel, area 51, and other absurdities. Nothing you can do will get them to stop yapping on and get to work. You barely get any studying done. What informational problem best describes the source of the market failure described above
