PLEASE HELP WILL RATE ASAP

QUESTION 20 In the following potential accident problem, the driver/injurer/defendant is D and the pedestrian/victim/plaintiff is P. The accident cost is $10,000, but the probability of accident is affected only by the level of care D chooses, which is indicated by his driving speed. If D drives at 60 mph, D's total benefit is 105, and the probability of accident is 0.0080. If D drives at 50 mph, D's total benefit is 90, and the probability of accident is 0.0060. If D drives at 40 mph, D's total benefit is 77, and the probability of accident is 0.0045. If D drives at 30 mph, D's total benefit is 65, and the probability of accident is 0.0035. If D drives at 20 mph, D's total benefit is 55, and the probability of accident is 0.0030. If D drives at 10 mph, D's total benefit is 46, and the probability of accident is 0.0025. Assume that both parties D and P are risk neutral, that the probability of accident is only affected by D's level of care (in terms of mph), and that the accident loss is $10,000. When the case is brought to court, the disputed amount is equal to the accident loss and both P and D think that the plaintiff P's chance of prevailing at trial is 70%. Litigation cost for the plaintiff P is $3,000, and the litigation cost for the defendant D is $2,000. (A) First consider the case without the costly and uncertain litigation process. Efciency outcome dictates that D should drive at mph, and the social net benet is (B) With a costly & uncertain litigation process, it is efficient for D to drive mph, & social net benefit is (C) Assume that with a costly and uncertain litigation process, D drives 60 mph; there is an accident, and P les suit. Ifthe court rules in favor of P, the liability will equal the accident loss. Given that both P and D think that P's probability to prevail at trial is 70%, ifthey settle at an amount greater than but less than , it would make both parties better off than going to trial. (D) With a costly and uncertain litigation process and if the parties will not settle, under strict liability D drives mph. In this case, D's marginal benefit of driving at this speed is , his marginal cost of driving at this speed is , and the social net benefit is 20 pi