Question 4 Solve

4. The owner of a thriying business wants to start up a satellite of that business in a distant city. If she hires someone who manages the new office honestly, she can afford to pay a weeldy salary of$l000 apremium of $500 over what the manager would have otherwise been able to earn and still earn weeldy financial return of 331000 for herself. The owner's concern is that she will not be able to monitor the behavior of the satellite manager, and that this person would therefore be in a position to embezzle heavily from the business. The owner lcnows that if the satellite office is managed dishonestly, the manager can earn $1500, while causing the owner a financial loss of 33500 per week. a. If the owner believes that the managerial candidate comes from a society whose members have been strongly conditioned to behave honestly, will she open the new office? b. If the managerial candidate to be willing to pay $10,000 to avoid the guilt he would feel if he managed dishonestly, will she open the new office