The Matrix Given Below Represents the Payoffs to Producer Hansel

Multiple Choice

The matrix given below represents the payoffs to producer Hansel and purchaser Gretel from a transaction.Hansel is the producer of Good X and Gretel is the purchaser.Assume that Gretel has no incentive to break the contract.


-Refer to Table .Will breaching of the contract be an efficient outcome?

A) Yes, because Hansel will earn $12 after paying expectation damage and Gretel will remain as well off as under the contract.
B) No, because Hansel will earn $5 after paying expectation damage and Gretel will remain as well off as under the contract.
C) Yes, because both Hansel and Gretel will remain as well off as under the contract and Gretel's earnings will increase.
D) No, because Hansel will remain as well off as under the contract and Gretel's earnings will fall.