NEED HELP PLEASE ASAP!
I JOINED THIS SITE HOPING THAT I WILL GET HELP FROM THE TUTORS, & SO FAR NO LUCK!
All questions credit have been refunded ??
I will try again and I hope I am lucky this time as I copy the entire questions.
No one seemed able to help me with my questions.
Below are the complete economics questions that I definitely need them solve please.
Practice Problem 4. Suppose there are two types of borrowers. Type O repays with prob. 0.92 and type B repays with prob. 0.8. Each type needs a loan of $190. If the bank cannot observe type, but believes that fraction 0.45 of the borrowers are type O what is the competitive pooling rate?
Practice Problem 5. Find the mark up on the interest rate the type O borrower has to pay under the pooling rate? This is the difference between the