Give examples of how government intervention helps reduce moral hazard and adverse selection problems in internal labor markets.
What will be an ideal response?
Since the 1960s, federal laws in the U.S. dealing with affirmative action, and equal employment opportunity have shaped organizational architecture and reward systems. Courts tend to have a favorable view of companies that have a clear and well-written job description, a well-articulated and understandable appraisal system, and show evidence of transparent procedures for job completion requirements, feedback provisions, evaluations and equal treatment of equally capable employees.
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Buyers scrambled to secure stocks of Australian wool following a forecast of an 11 percent decline in wool production. What happens in the Australian wool market as a result of this announcement?
A) The quantity of Australian wool demanded increases in anticipation of higher prices in the future. B) The demand curve for Australian wool shifts to the left in anticipation of higher prices in the future. C) The quantity of Australian wool demanded decreases in anticipation of lower quantities in the future. D) The demand curve for Australian wool shifts to the right in anticipation of higher prices in the future.
Suppose a government is considering imposing either a tariff or a quota on imported grain, and either policy will result in exactly 750 tons of grain being imported. How do these policies differ?
A. The quota will generate revenue for the firms that hold import licenses, while the tariff will generate revenue for the government. B. Domestic production will be higher with the quota than with the tariff. C. The price of grain under the quota will be higher than the price under the tariff. D. The price of grain under the tariff will be higher than the price under the quota.
If the demand for steak increases as income increases, then steak is a(n):
A. normal good. B. inferior good. C. substitute good. D. complementary good.
How can diseconomies of scale occur at larger capacities?
What will be an ideal response?