In the presence of asymmetric information, a piece-rate contract
A) achieves production efficiency.
B) can lead to agents producing more output than would occur under a fixed-rent-paid-to-the-principal contract.
C) is impossible to write.
D) will result in the principal earning all of the profit.
B
Economics
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The marginal product and average product curves
A) never intersect. B) intersect at the maximum point of the marginal product curve. C) intersect at the maximum point of the average product curve. D) do not intersect at any predictable point.
Economics
A 10 percent increase in income increases the quantity of apple juice demanded from 18,800 to 21,200 gallons. The income elasticity of demand for apple juice is
A) 0.5. B) 0.8. C) 1.0. D) 1.2.
Economics