1) Netbooks
Consider a market for used netbooks. There are two types of netbooks: Type A works fine, while Type B has some flaws. There are 20 netbook-owners willing to sell their netbook, 10 of each type. There are 17 potential buyers who would like to buy exactly one netbook. Owners have a valuation of 100 for their netbook if it is of Type A, while buyers hold a valuation of 150 for such a netbook. Sellers hold a valuation of 50 for a Type B netbook, while buyers value such a netbook at 75. All agents are risk-neutral. All agents are price-takers. Sellers know the type of their netbook, buyers don’t.
a) Determine supply and demand depending on price.
b) What are the equilibrium prices? What do equilibria look like?
2) Mas-Colell 13C5 3) Mas-Colell 13D2
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