Question 2 of 7 15 Points 10 Figure 1 Figure 2 W U 13 12 11 10 D - NWAOOVOO CO A I1 I2 A 1 2 3 4 5 6 7 8 9 10 2 3 4 5 6 7 8 9 10 11 S F Click to see additional instructions A. Refer to Figure 1. In this figure, the market envelope offers wage-safety combinations with wages between s and $ (Enter lower value before higher value) and safety levels between and (Enter lower value before higher value). Based on this figure we expect the more risk-averse individual to be employed with wage $ and safety level The less risk-averse individual will have safety reduced by relative to the risk-averse individual and in compensation will be paid $ more. The (absolute) slope of the wage-safety locus is B. Refer to Figure 2. At the threat point, the union's payoff is and the firm's payoff is . If there is only one round of bargaining, this point (Enter 1 for "is", 0 for "may or may not be", 2 for "is not") a Nash solution. Activate Windows The point A has product of gains equal to Go to Settings to activate Wind If there are multiple rounds of bargaining and the firm makes the first offer, the Rubinstein outcome will give union payoff and firm payoff