In the presence of asymmetric information, the only contract that results in production efficiency and no moral hazard is the one in which
A) the agent receives a fixed fee.
B) the principal receives a fixed rent.
C) profit is shared.
D) revenue is shared.
B
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What would lead an economist to conclude that Theory A is superior to Theory B?
A) Theory A predicts real-world events better than does Theory B. B) The assumptions underlying Theory A are more realistic than are the assumptions underlying Theory B. C) Theory A explains how people think, whereas Theory B only explains what they do. D) Theory A is based on the assumption that an individual typically cannot determine what is in his or her own best interest, whereas Theory B assumes that each person knows what is in his or her own best interest and acts accordingly.
If a price floor of $23 were placed in the market in the graph shown:
A. some surplus is transferred from consumer to producer.
B. some surplus is transferred from producer to consumer.
C. all producers are better off.
D. all consumers are better off.
To answer the question, refer to the following table showing a demand schedule: 
As quantity demanded rises from 1,400 to 1,800, what is marginal revenue?
A. -$400 B. $50 C. $25 D. -$50 E. -$75
Assume the economy is at full employment and that investment spending declines dramatically. If the goal is to restore full employment, government fiscal policy should be directed toward:
A. an equality of tax receipts and government expenditures. B. an excess of tax receipts over government expenditures. C. an excess of government expenditures over tax receipts. D. a reduction of subsidies and transfer payments and an increase in tax rates.