Describe how business risk affects employees
Please provide the best answer for the statement.
Employees are shielded from business risk. When employees are hired, they are offered a contract specifying a given wage based on a time frame for working whether the firm is making a profit or loss. If the firm experiences a loss the owners of the business must find the funds to continue operation or shut down the business. If the firm experiences profits the owners of the business are not required to share the profit with the employees, it is their reward for bearing the risk.
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The following is NOT an example of a potential monitoring solution to moral hazard
a. blocking social network sites on company computers b. closed circuit TVs throughout a warehouse c. requiring a kitchen remodeling contractor to be 'bonded' d. listening in on call center conversations
A price ceiling is binding when it is set
a. above the equilibrium price, causing a shortage. b. above the equilibrium price, causing a surplus. c. below the equilibrium price, causing a shortage. d. below the equilibrium price, causing a surplus.
If a 10% decrease in price for a good results in a 20% increase in quantity demanded, the price elasticity of demand is
a. 0.50. b. 1. c. 1.5. d. 2.
If the price elasticity of demand for a good is 6, then a 3 percent decrease in price results in
a. a 20 percent increase in the quantity demanded. b. an 18 percent increase in the quantity demanded. c. a 2 percent increase in the quantity demanded. d. a 1.8 percent increase in the quantity demanded.