Question: please help me with this question John works for company A and earns $10000 per annual. One of John's friends attempts to bribe John for

please help me with this question

John works for company A and earns $10000 per annual. One of John's friends attempts to bribe John for some private information of company A. John is assured that he can ask for any price z upto $4000. If John accepts the bribe without getting detected by company A, he can keep the money received from his friend. However, if John gets caught, he has to return the money from his friend and pay a penalty, which is double the amount of the bribery. And the probability of getting caught is P.

Question : Suppose John is an expected utility maximiser with von Neumann-Morgenstern utility function v(w) = w and P = 1/5 , will John accept the bribe? If John accepts the bribe, how much will he ask for from his friend?

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