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At the beginning of each round, each Firm is randomly assigned one of two possible types: Type A or Type B, with both types equally likely. Both types of Firms start the round with 100 virtual plates, but they differ in the composition of these plates:

Neither the Firm nor its matched Auditor know the exact type of the Firm. However, in each round, both players observe a certain number of plates, randomly drawn from the Firm’s 100 plates. We refer to the process of observing these plates as an “audit”. After the audit, the Auditor must decide whether to report the matched Firm as Type A or Type B.

The true type of the Firm, the Auditor’s report decision, and chance determine the number of tokens that the Firm, the Auditor, and the Nonprofit earn in the round. In the next screens, you will see detailed instructions about each step in Task 1.

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