Joe wants to achieve the highest position possible with the XYZ Co During the interview, he tells them he is capable of performing many difficult tasks. The company feels there is a 10% chance he is lying
Given the payoff matrix in the above figure, what job level will the company offer to Joe? Why?
The expected payoff to the firm of giving Joe a demanding job is (0.9 ? 2 ) + (0.1 ? 1 ) = 1.9. The expected payoff to the firm of giving Joe an undemanding job is (0.9 ? 1 ) + (0.1 ? 4 ) = 1.3. The firm's expected payoff is greater if Joe has a demanding job. Even though Joe's interests diverge from the company's and he has the incentive to claim high ability regardless of whether it is true, the firm feels there is a very high probability that Joe does have high ability and therefore offers a demanding job.
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What will be an ideal response?
In the Keynesian model, the difference between no intervention by the government during a recession and intervention using expansionary monetary or fiscal policy is that no intervention will return the economy to its equilibrium level of output
A. slower than intervention will and at a higher price level. B. faster than intervention will and at a lower price level. C. slower than intervention will and at a lower price level. D. faster than intervention will and at a higher price level.
Refer to Edgeworth Box Economy. Analysis of an Edgeworth box economy shows that a competitive equilibrium
a. must be Pareto optimal. b. can be located anywhere along the contract curve. c. may lie anywhere within the region of mutual advantage. d. must lie to the southeast of the endowment point.
To have an effect on the market price, price ceilings must be set above the equilibrium price. ?
Answer the following statement true (T) or false (F)