In the presence of asymmetric information, a fixed-fee contract
A) achieves production efficiency.
B) can lead to opportunistic behavior on the part of the agent.
C) is impossible to write.
D) will result in the principal earning all of the profit.
Ans: B) can lead to opportunistic behavior on the part of the agent.
Economics
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Funds are channeled from savers to borrowers directly through ________ and indirectly through ________
A) financial markets; financial intermediaries B) financial intermediaries; financial markets C) main banks; branches D) brokers;' agents
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