6) Assume that Incom Fighter Systems is suing the New Republic for breach of contract. They have filed suit for 100 million galactic credits due to a cancelled X-Wing order. However, before the case goes to trial, the two parties can try and negotiate a settlement. The New Republic can make an offer, and then Incom can either accept the offer or press forward with the suit. (Assume there is just a single offer, and no counteroffers). Each side believes that Incom has a 70% chance of winning the lawsuit if it ends up in court. In addition, Incom would have to pay 15 million credits in lawyers fees, while the New Republic would pay 5 million if the case goes to trial. Draw the game, then solve it to

6) Assume that Incom Fighter Systems is suing the New Republic for breach of contract. They have filed suit for 100 million galactic credits due to a cancelled X-Wing order. However, before the case goes to trial, the two parties can try and negotiate a settlement. The New Republic can make an offer, and then Incom can either accept the offer or press forward with the suit. (Assume there is just a single offer, and no counteroffers). Each side believes that Incom has a 70% chance of winning the lawsuit if it ends up in court. In addition, Incom would have to pay 15 million credits in lawyers fees, while the New Republic would pay 5 million if the case goes to trial. Draw the game, then solve it to

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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