Decision tree diagram illustrating a signaling game in a job market.

Create a clean, academic-style decision tree diagram for a signaling game involving a job market: Nature assigns a worker type: Type A (highly competent) or Type B (less competent), with equal probability. The worker observes their type and chooses one of two actions: • Take an unpaid year of public interest work • Apply to the firm immediately The firm observes only whether the applicant did the unpaid year, not the applicant’s type. Based on the signal, the firm chooses to Hire or Not Hire. The diagram should include clearly labeled branches, decision points, and outcomes. Use boxes or nodes to indicate decisions by Nature, the worker, and the firm. Use arrows and spacing to create a readable, left-to-right layout. Also, Label the unpaid year path as “costly signal” Note that the firm’s goal is to hire only Type A Mark which paths could lead to pooling or separating equilibria See more