Author Question: Production inefficiency is most likely to occur when the principal has more information about work ... (Read 68 times)

Sufayan.ah

  • Hero Member
  • *****
  • Posts: 512
Production inefficiency is most likely to occur when the principal has more information about work performance than the agent does.
 
  Indicate whether the statement is true or false

Question 2

An efficient contract is an agreement in which
 
  A) neither party can be made better off without harming the other party.
  B) both parties agree on its clauses.
  C) one party takes all.
  D) both parties agree to always do their best.



Bigfoot1984

  • Sr. Member
  • ****
  • Posts: 321
Answer to Question 1

False. It is when the agent has more information that production inefficiency is more likely to occur. The agent is able to shirk without being detected by the principal.

Answer to Question 2

A



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question


 

Did you know?

Side effects from substance abuse include nausea, dehydration, reduced productivitiy, and dependence. Though these effects usually worsen over time, the constant need for the substance often overcomes rational thinking.

Did you know?

Tobacco depletes the body of vitamins A, C, and E, which can result in any of the following: dry hair, dry skin, dry eyes, poor growth, night blindness, abscesses, insomnia, fatigue, reproductive system problems, sinusitis, pneumonia, frequent respiratory problems, skin disorders, weight loss, rickets, osteomalacia, nervousness, muscle spasms, leg cramps, extremity numbness, bone malformations, decayed teeth, difficulty in walking, irritability, restlessness, profuse sweating, increased uric acid (gout), joint damage, damaged red blood cells, destruction of nerves, infertility, miscarriage, and many types of cancer.

Did you know?

Fungal nail infections account for up to 30% of all skin infections. They affect 5% of the general population—mostly people over the age of 70.

Did you know?

As many as 20% of Americans have been infected by the fungus known as Histoplasmosis. While most people are asymptomatic or only have slight symptoms, infection can progress to a rapid and potentially fatal superinfection.

Did you know?

Cyanide works by making the human body unable to use oxygen.

For a complete list of videos, visit our video library