Reference no: EM133083524

Yvonne Smith expects $100 worth of value from an addition to her home. A contractor can do the job at a cost of $25 and offers to do the job for $50. During construction, the buyer would have to rent a motel room at a price of $25. - Use the extensive form game to illustrate the strategies and payoffs for both parties. . In the absence of contract law, and assuming that both parties are rational. do you expect a contract to be signed between the two? Explain. . Assume now that liability for non-performance is equal to $25 for damages. and that the contractor spends $10 in litigation costs. How would your result differ from your previous answer? Explain.