A risk-averse manager is hired to run a firm for shareholders. If the manager's effort can be observed and specified in a contract, which would be the best employment contract?
a. a high-powered incentive contract to elicit the most effort.
b. a fixed salary paid as long as the required effort is undertaken.
c. a proportion of profits paid as long as the required effort is undertaken.
d. a wage well in excess of his or her outside opportunity.
b
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There is an inverse relationship between the quantity of money demanded and the interest rate. True or False
The IS curve plots for each level of income the ________ that causes income to equal ________
A) interest rate, planned expenditures B) interest rate, planned autonomous spending C) planned autonomous spending, planned expenditures D) planned autonomous spending, planned autonomous spending
The primary trading partner of the United States is
a. Japan b. Mexico c. Canada d. Britain e. Korea
A tractor used to prepare land for planting is called
A) land. B) labor. C) physical capital. D) human capital.