Economics 1st Edition by Dean Karlan,Jonathan Morduch

Exercise 13

You need to paint your fence but you really hate this task. You decide to hire the kid next door to do it for you. You would be willing to pay him up to $100, but you start by offering $50, expecting to negotiate. To your great surprise, he accepts your $50 offer. When you tell your friend about the great deal you got, she is shocked that you would take advantage of someone. What can you tell your friend to assure her that you did not cheat the kid next door?