Answer just part d) Rafe is a python programmer with extremely unique and valuab

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Answer just part d) Rafe is a python programmer with extremely unique and valuable skills. He has worked at TiltSoft Inc., a Silicon Valley startup firm, for five years. The firm, therefore, has very good information regarding the value of his unique skills. They know whether his skills are "extremely valuable or just "valuable." Because Rafe has worked at TiltSoft so long and knows their products so well, his productivity is higher at TiltSoft than elsewhere Rafe's employment contract is up for renewal and he and his employer are bargaining over his future salary. Assume Rafe must make a take-it-or-leave-it salary offer to the firm. If the firm refuses Rafe's offer, Rafe will leave TiltSoft and become an entrepreneur. Since Rafe's skills are so unique, TiltSoft cannot replace Rafe the value his skills would create at TiltSoft is simply lost. Rafe's productivity (per year, say) as a function of his job and the value of his skills is given in the table below. (Assume everyone knows all numbers in this table.) Rafe's Productivity Rafe's Productivity as an Entrepreneur at TiltSoft Valuable" Extremely Valuable" $100,000 S300,000 $150,000 $350,000

Explanation / Answer

Rafe was the python programmer with extremely unique and valuable skills and he was well known in tilt soft for that and his productivity was higher as well.

D-"Market for lemons" is the market wherein there is uncertain quality is offered ,the main focus is given on quality as the quality od goods sold in the market might affect the assymetric information.The term "lemon" is used in americ for defective car which gets noticed after it has been bought.

If we compare the productivity of rafe as an entrepreneur ,it was low as per the figures shown in both valuable and extremely valuable category so it might lead to a market for lemons but if we see the productivity as an an employee of tilit soft was much higher in both the categories so choosing to be with tilt soft will provide symmetric information with good quality goods as compared to work as an entrepreneur.

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