Demand with zero transaction cost is Q1D=50-P and supply is QS= - 7+2P.
a. Verify all of the prices and quntities.
b. Now assume that intermediaries come from a competitive market with an equilibrium price of $8 per unit for their services, that is any buyer or seller who wants an intermediary's services must pay $8 for them. What is the maximum per unit that sellers are willing to pay intermediares if hiring them saves buyers $8 in transaction cost?
c. Does your answer to question 16a change if buyers pay $8 per unit to the intermediary but sellers offer to reduce part of that expense to buyers?