Firms that have high cost of monitoring, choose their employees much more carefully because
a. They are afraid that the employee would be too productive
b. They are more confident that after getting the job, the employee would not shirk
c. They are afraid that without screening, the employee would be more likely to shirk
d. B & C
d
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If a lower price for a Pepsi decreases the demand for a Coke, the cross elasticity value for Pepsi and Coke is
A) definitely negative. B) definitely equal to zero. C) definitely positive. D) definitely greater than one. E) possibly negative, positive, or zero, but there is not enough information to decide.
Sarah is considering lending an amount of $45,000 to her friend who promises to return $60,000 after the end of ten years
What is the net present value of Sarah's investment? Is it worthwhile to undertake this investment? Assume that the market rate of interest is 6%.
The prisoner's dilemma is used to analyze business situations in which one firm acts first and then other firms respond
Indicate whether the statement is true or false
Changes in exchange rates are due to
A) real events only. B) nominal events only. C) both real and nominal events. D) None of the above.