Author Question: If a principal and agent have an efficient contract, then A) one of them must be more risk-averse ... (Read 36 times)

Mr.Thesaxman · **on:** Jul 1, 2018

If a principal and agent have an efficient contract, then

A) one of them must be more risk-averse than the other.
B) neither can be made better off without harming the other.
C) they must have symmetric information.
D) the principal bears more of the risk.

Question 2

Government policies that encourage savings

A) reduce interest rates.
B) increase interest rates.
C) have no effect on interest rates.
D) lower the net present value of all investments.