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Suppose that everybody knows that 50% of stores in the market sell Number 2 pencils for $4 a box, and 50% sell Number 2 pencils
Suppose that everybody knows that 50% of stores in the market sell Number 2 pencils for $4 a box, and 50% sell Number 2 pencils for $3 a box. If a consumer observes a price of $4, what is the expected benefit from an additional search?
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Intermediate Microeconomics
Authors: Hal R. Varian
9th edition
978-0393123975, 393123979, 393123960, 978-0393919677, 393919676, 978-0393123968
