If good salespeople are extremely risk averse, then a choice between a fixed-fee contract and a contingent contract
A) avoids a moral hazard.
B) will result in all job candidates choosing the contingent contract.
C) will result in an efficient contract.
D) may not be a good screening device.
D
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Suppose the equilibrium quantity of labor hired decreases and the equilibrium real wage rate increases. All else constant, this situation will also result in
A) more government outlay for the unemployed. B) higher output prices. C) lower output prices. D) fewer benefits for those still unemployed.
Which of the following is FALSE?
A) Economies of scale may be internal, external, or both. B) With internal economies of scale, the gains from trade include a wider selection of consumer choices and lower prices. C) With external economies of scale, the gains from trade are less certain since, in theory, they can lock in production in a less efficient country and prevent the development of production in a more efficient country. D) Internal economies of scale lead firms to regionally concentrate their industry.