The problem with the separation of ownership from control is that
A) the owner in a proprietorship may not always act in the profit-maximizing fashion because he or she may not have the experience or expertise that professional managers have.
B) the managing partner of a firm may not always behave in the way that other managers would if they were the managing partners.
C) the managers of the firm can make decisions that reduce the wealth of the owners while not reducing their own wealth.
D) the owners of firms may not always know the best way to run a firm, yet they are the ones who elect the managers of the firm.
C
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Efficiency wages cause unemployment because
A) firms pay wages that are above the market wage, causing the quantity of labor demanded to be greater than the quantity of labor supplied. B) firms pay wages that are above the market wage, causing the quantity of labor demanded to be less than the quantity of labor supplied. C) firms pay wages that are below the market wage, causing the quantity of labor demanded to be less than the quantity of labor supplied. D) firms pay wages that are below the market wage, causing the quantity of labor demanded to be greater than the quantity of labor supplied.
What is the difference between physical capital and human capital?
What will be an ideal response?
In the above figure, S1 represents the supply curve which includes private costs, and S2 is the supply curve which includes social costs. If the firm is producing a product that has external costs that the firm does have to pay, what will be the equilibrium price and quantity?
A. P3, Q2 B. P4, Q1 C. P2, Q3 D. P1, Q4
Labor is demanded by firms in an output market.
Answer the following statement true (T) or false (F)