Consumers’ possible strategies under beliefs (p; q = ρ)

Conditions

1) “Always inspect”

c i < min ( e ( 1 ρ ) ( 1 y ) + ρ d y , e ( 1 p ) ( 1 x ) ( e e p d p ) )

2) “Inspect negative, not inspect positive”

e ( 1 ρ ) ( 1 y ) + ρ d y < c i < e ( 1 p ) ( 1 x ) ( e e p d p )

3) “Not inspect negative, inspect positive”

e ( 1 p ) ( 1 x ) ( e e p d p ) < c i < e ( 1 ρ ) ( 1 y ) + ρ d y

4) “Always not inspect”

c i > max ( e ( 1 ρ ) ( 1 y ) + ρ d y , e ( 1 p ) ( 1 x ) ( e e p d p ) )