One way to avoid the principal-agent problem would be to have:
A. the employer constantly monitor the employee's efforts.
B. the employee sign a waiver of release.
C. the employer share all management choices with employees before making decisions.
D. the employee constantly monitor the employer's activities.
Answer: A
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The decisions of firms and households are
A) coordinated by but not totally controlled by the government. B) made independently of one another. C) controlled by but not totally coordinated by the government. D) coordinated by markets. E) unexplainable by the circular flow model.
A firm's fundamental goal is
A) different for each firm. B) to make a quality product. C) to maximize profit. D) to gain market share. E) to decrease its employment of workers in order to cut its costs.
Which of the following resources is not essential in the production of a typical cheese pizza?
A) Dough B) Sauce C) Heat D) Fodder for cows E) Trick question: all of the above are essential.
The marginal revenue curve for a single-price monopoly
A) is horizontal. B) is upward sloping. C) lies above the market demand curve. D) lies below the market demand curve.