Which one of the following is a source of conflict between owners and managers?
A. A manager's effort leaves the firm's value and the manager's utility unchanged.
B. A manager's effort increases the firm's value but decreases the manager's utility.
C. A manager's effort increases the firm's value and the manager's utility.
D. A manager's effort decreases the firm's value and the manager's utility.
Answer: B
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Agricultural price supports are
A) price ceilings. B) price floors. C) quantity quotas. D) taxes.
When a good is excludable:
A. one person's consumption prevents or decreases others' ability to consume it. B. it is possible for sellers to prevent its use by those who have not paid for it. C. consumers have a perception of scarcity of that good. D. the government has specific import policies limiting its supply.
With time, an appreciation in the value of the nation's currency in the foreign exchange market would cause
a. the nation's imports to increase and exports to decline. b. the nation's exports to increase and imports to decline. c. both imports and exports to decline. d. both imports and exports to rise.
In summarizing the research on the externalities associated with driving cars, a 2007 Journal of Economic Literature article concluded that the optimal corrective tax on gasoline in the United States, in 2015 dollars, would be about
a. $0.50 per gallon. b. $0.90 per gallon. c. $2.58 per gallon. d. $2.78 per gallon.