Indicate for each sentence whether it is true or false. Mark true with a T and false with a F. For each sentence, write a few words of justification.

Suppose that firms A, B, and C have the option to coalize with another firm to exclude the third from the market, or to make a big coalition with the three of them. That is, the four possible coalitions that can be formed are {A, B}, {A, C}, {B, C}, and {A, B, C}. Each possible coalition creates a market value that can be shared (although not equally) between the firms involved. Coalition {A, B} has value 80, {A, C} has value 110, {B, C} has value 140, and {A, B, C} has value 165.

a. In the bargaining set, the payoff for A is 55. b. The bargaining set is empty. c. The allocation (25 to A, 55 to B) following coalition {A, B} is blocked by coalition {B, C} with allocation (30 to B, 80 to C). d. The core is not empty. e. The allocation (30 to A, 60 to B, 85 to C) is Pareto-efficient