A chief reason firms give employees bonuses based on the firm's profit is to cope with
A) the tax laws.
B) the law of diminishing returns.
C) the principal-agent problem.
D) unions.
C
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A college graduate in 1972 found a job paying $7,200. The CPI was 0.418 in 1972. A college graduate in 2005 found a job paying $30,000. The CPI was 1.68 in 2005. The 1972 graduate's job paid ________ in nominal terms and ________ in real terms than the 2005 graduate's job.
A. more; more B. more; less C. less; more D. less, less
Which of the following is NOT included in the money supply when the transactions approach is used?
A) currency B) traveler's checks C) money market deposit accounts D) transaction deposits
An unexpected fall in Retail Sales should send bond prices __________ and stock prices __________
A) up; up B) up; down C) down; up D) down; down
The above figure shows Bob's utility function. He currently has $100 of wealth, but there is a 50% chance that it could all be stolen. Living with this risk gives Bob the same expected utility as if there was no chance of theft and his wealth was
A) $0. B) $20. C) $30. D) $50.