If the entrepreneur is also the manager of the firm, we would expect
A) the manager to work hard because he or she is also the residual claimant.
B) the manager to not work hard since there is no possibility of further advancement.
C) the firm to operate poorly because the specialization of labor is not adequate.
D) the firm to operate poorly because the entrepreneur is not as good at managing workers as a professional manager would be.
Answer: A
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