To keep employees from shirking, you can invest in greater monitoring
a. even though monitoring is expensive
b. especially when monitoring is not very efficient
c. when employees fail to respond to incentive contracts
d. when incentives solve both moral hazard and adverse selection problems with employees
c
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All else being equal, if the rate of growth in productivity in Spain is greater than the rate of growth in productivity in the United States, the euro
A) will decrease in value relative the U.S. dollar. B) will nominally depreciate against the dollar, but its real value relative to the dollar will remain unchanged. C) will increase in value relative to the U.S. dollar. D) will nominally appreciate against the dollar, but its real value relative to the dollar will remain unchanged.
Refer to Figure 10-3. Best friends Laurel and Hardy, both enjoy watching romantic comedies and science fiction movies. Based on the diagrams above what can you conclude about their movie preferences?
A) They have identical movie preferences. B) The diagrams do not provide any information about relative preferences. C) Laurel enjoys science fiction movies more than Hardy. D) Laurel enjoys romantic comedies more than Hardy.
A progressive tax:
a. is designed to take a larger percentage of higher incomes as compared to lower incomes b. takes a greater proportion of the income of lower-income groups than of higher-income groups. c. is designed so that everybody would be charged the same percentage of their income. d. is designed to take a smaller percentage of higher incomes as compared to lower incomes.
Chad is willing to pay $5.00 to get his first cup of morning latté; he is willing to pay $4.50 for a second cup. He buys his first cup from a vendor selling latté for $3.75 per cup. He returns to that vendor later in the morning to find that the vendor has increased her price to $3.90 per cup. Chad buys a second cup. Which of the following statements is correct?
a. Chad's willingness to pay for his second cup of latté was smaller than his willingness to pay for his first cup of latté. b. Chad's consumer surplus on his second cup of latté was larger than his consumer surplus on his first cup of latté. c. Chad is irrational in that he is willing to pay a different price for his second cup of latté than what he is willing to pay for his first cup of latté. d. Chad places a higher value on his second cup of latté than on his first cup of latté.