The problem of production in multi-plant firms with asymmetric information can be solved by paying the manager
A) a piece rate, some constant amount per unit of output produced.
B) a larger amount for each unit than was paid for the previous unit, to reflect increasing marginal cost.
C) a smaller amount for each unit than was paid for the previous unit, to reflect decreasing marginal revenue.
D) an annual bonus that increases with each unit of output up to capacity, and decreases with each unit of output past capacity.
E) an annual bonus that is calculated decreases with each unit of output up to capacity, and increases with each unit of output past capacity.
D
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A real appreciation of the dollar is caused by either a nominal appreciation of the dollar, a rise in the foreign price level, or a fall in the U.S. price level
Indicate whether the statement is true or false
In the simultaneous move labor negotiation game:
a. Neither party prefers bargaining hard in the Nash equilibrium b. Both the parties want to end up in the least efficient outcome c. Both parties bargain hard in the Nash equilibrium d. Both parties want to stay in the prisoner's dilemma