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Author Question: Shirking is most likely to occur when A) the principal monitors the agents extensively. B) ... (Read 39 times)

Jramos095

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on: Jul 1, 2018
Shirking is most likely to occur when
 
  A) the principal monitors the agents extensively.
  B) employees are paid an hourly wage.
  C) a piece rate contract is used.
  D) an assembly line is used for production.

Question 2

According to the Theory of the Second Best, why might market liberalization through elimination of some market distortions, such as particular trade restrictions, lead to social welfare losses?
 
  What will be an ideal response?


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pallen55

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Reply #1 on: Jul 1, 2018
Answer to Question 1

B

Answer to Question 2

Removing some distortions may increase the deadweight losses accrued from other distortions. This may lead to a net loss from reducing trade restrictions.


Jramos095

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Reply 2 on: Jul 1, 2018
:D TYSM

aliotak

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Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

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