The principal-agent problem arises because the agent's objectives differ from those of the principal
a. True
b. False
A
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Suppose the government of New Country fixes the exchange rate of its currency, the Newo, in terms of the U.S. dollar. Initially the exchange rate is set at $0.50 per Newo. Later the government changes the exchange rate to $0.75 per Newo. This is an example of a(n):
A. appreciation B. revaluation C. depreciation D. devaluation
When society produces the combination of goods and services on the PPF that it values the most highly, society has
A) achieved only production efficiency and definitely not allocative efficiency. B) achieved only allocative efficiency definitely not production efficiency. C) achieved both production efficiency and allocative efficiency. D) achieved a free lunch. E) perhaps achieved production efficiency and has perhaps achieved allocative efficiency.
When a negative externality exists, the private cost of production ________ the social cost of production
A) is greater than B) is less than C) eliminates D) is equal to
In a tit for tat strategy players
a. Focus on maximizing your own profit b. Focus on minimizing the rivals profits c. Make their strategy difficult for competitors to understand d. All of the above