Consider a three-type economy like the one described in Section 20.1.3. Assume that θH is 10, θM is 4 and θL is 2.
a) Assume that there are 5 type H people, 15 type M people, and 10 type L people. Find a Nash equilibrium.
b) Assume that there are no type H people, 15 type M people, and 15 type L people. Find a Nash equilibrium.