Given a series of contracts offered to an executive having the same slope (where slope refers to how the contract varies with changes in the firm's gross profits) but different intercepts (referring to the overall generosity of the contract). Which of these is not a consideration in figuring out which of these intercepts the shareholders would decide to build into the contract offered to the
executive?
a. if too generous a contract is offered, this comes out of the firm's bottom-line profit.
b. if too generous a contract is offered, the executive may become lazy and not exert the required effort.
c. if the contract isn't generous enough, the executive will decide to work elsewhere.
d. if the contract isn't generous enough, only low-ability executives will apply.
b
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A demand curve with an elasticity of 1.0 is a unit-elastic demand curve.
Answer the following statement true (T) or false (F)
A shift of the MP curve ________
A) implies an automatic adjustment of the interest rate B) implies a direct policy action of the Federal Reserve C) does not alter the relationship between inflation and the interest rate D) all of the above E) none of the above
As country incomes rises, what would you generally expect to happen to the burden of noncommunicable diseases as a share of the total disease burden?
A) It should go up B) It should stay about the same C) There is no consistent relationship between the two D) as country incomes rise E) It should go down
The income effect of a wage rate increase should lead to
A. a decrease in the quantity of labor supplied and a decrease in leisure. B. an increase in the quantity of labor supplied and an increase in leisure. C. an increase in the quantity of labor supplied and a decrease in leisure. D. a decrease in quantity of labor supplied and an increase in leisure.