There is one empty job position and you want to hire a worker.
There are two workers, Ann and Bob. With equal chance, the worker who come to you to get the job is Ann or Bob.
You will submit your wage offer but when you make the offer, you do not know the worker who wants to get a job is Ann or Bob.
The revenue each worker brings you when you hire them is given as follows:
Revenue from each Worker
Ann
Bob
30
20
The worker accepts any wage higher than or equal to the minimum willingness to accept
In that case, your profit is: Revenue the worker brings you - Wage Offer
Otherwise, the worker rejects the offered wage
In that case, your profit is 0
Minimum Willingness to Accept
Ann
Bob
5
15
Suppose that you suggest the wage of 10. Then only Ann would accept the job because 10 is greater than Ann's minimum willingness to payoff and less than Bob's
minimum willingness to payoff
Then, with one half probability Ann comes to you and you get 30(Revenue from Ann)-10(Your wage offer)=20.
With one half probability Bob comes to you but he rejects your offer. Then, your final payoff will be 0.