In the presence of asymmetric information with costless monitoring and enforcement, a hire contract results in production efficiency
Indicate whether the statement is true or false
True . The agent has the incentive to shirk; however, since she can be monitored costlessly, she will not.
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If the price of hair styling increases, then
A) hair styling salons hire fewer workers but makes more profit. B) hair stylists demand an increase in wages and the salons hire fewer workers. C) the value of marginal product of each hair stylist increases and the demand curve for hair stylists shifts leftward. D) the value of marginal product of each hair stylist increases and the demand curve for hair stylists shifts rightward.
Demand for a luxury item, such as a yacht, is likely to be
A) income elastic and price inelastic. B) income inelastic and price elastic. C) both income elastic and price elastic. D) both income inelastic and price inelastic.
When good weather speeds the check-clearing process, float tends to ________ causing the Fed to initiate defensive open market ________
A) decrease; sales B) decrease; purchases C) increase; sales D) increase; purchases
A common tool for restricting trade through taxation is:
A. a tariff. B. immigration restrictions. C. international waters use policies. D. quota.