Which of the following is a reason why job A would pay a higher wage rate than job B?
a. job B requires more education
b. job A offers greater fringe benefits
c. job A offers free parking
d. job A involves greater risk
e. job B has a higher skill requirement
D
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La Tortilla is the only producer of tortillas in Santa Teresa. The firm produces 10,000 tortillas each day and has the capacity to increase production to 100,000 tortillas each day
La Tortilla has made a large profit for years, but no other firm has chosen to compete in the Santa Teresa tortilla market. La Tortilla has been able to deter entry because if other firms were to enter the market it would greatly step-up production and reduce price. A) La Tortilla's behavior is inconsistent with economic theory. B) La Tortilla has been successful because of its credible threat. C) La Tortilla behaves like a Stackelberg firm. D) La Tortilla must have other barriers to entry to protect its monopoly power.
Various executive compensation plans have been employed to motivate managers to make decisions that maximize shareholder wealth. These include:
a. cash bonuses based on length of service with the firm b. bonuses for resisting hostile takeovers c. requiring officers to own stock in the company d. large corporate staffs e. a, b, and c only