Monitoring
a. Gives the principle a better performance evaluation metric
b. Allows the principle to better align the incentives of the agent with the goals of the principle
c. Can be costly for the principal
d. All of the above
d
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Gross domestic product (GDP) understates total economic activity because it ignores household production of goods and services
a. True b. False Indicate whether the statement is true or false
Reducing _____ the benefits available to the buyer and seller and might also enable them to make exchanges that were previously impossible
a. transaction costs decreases b. transaction costs increases c. marginal costs decreases d. marginal costs increases
Say Anna's utility function was given by UA = (MA) (MM), where MA is Anna's wealth and MM is Marie's wealth. Initially, Anna has 160 units of wealth and Marie has 40. When Anna maximizes her utility level is equal to
A. 100. B. 5,000. C. 200. D. 10,000.
Assume that the marginal cost of producing steel does not include the cost of the damage to the environment as a result of pollution. By producing where P = MC, the firm will be producing
A. the efficient amount of steel. B. more than the efficient amount of steel. C. a zero quantity of steel. D. less than the efficient amount of steel.