What is the problem with paying plant managers in multi-plant firms according to the level of output they produce?
A) Managers in low-cost or high-capacity plants could be penalized, in percentage terms, for their overproduction.
B) The production problem in multi-plant firms is usually how to lower production to increase market power, not how to increase production.
C) Managers in high-cost or low-capacity plants could be penalized for production constraints over which they have no control.
D) Managers would have an incentive to understate the productive capacity of their plants.
E) Managers would have an incentive to overstate the productive capacity of their plants.
C
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According to this Application, over time, as economies adapt to higher temperatures
A) approximately half the decline in per capita income disappears. B) per capita income does not seem to change. C) real income begins to increase and per capita income begins to decrease. D) approximately half the increase in per capita income disappears.
Which of the following is NOT a consumption good?
A) a U.S. government bond B) a UPS truck C) Nike swimming trunks D) a Subway sandwich E) marriage counseling services