A. a firm may realize excessively large profits. B. workers may provide less-than-expected work effort. C. compensating wage differences do not pay for differences in the nonmonetary aspects of jobs. D. human capital investments vary among
workers.
A. principals and agents share a common interest, leading to free-rider problems.
B. principals and agents are in an adversarial role, sharing no common interests.
C. principals pursue some of their own objectives, which may conflict with the objectives of
the agents.
D. agents pursue some of their own objectives, which may conflict with the objectives of the
principals.
Answer: D
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A decrease in the foreign interest rate causes the demand for domestic assets to shift to the ________ and the domestic currency to ________, everything else held constant
A) right; appreciate B) right; depreciate C) left; appreciate D) left; depreciate
The key to present value calculations is that they
A) are appropriate only for funds in the same time period. B) provide a common unit for measuring funds at different times. C) provide accurate answers only in a low-inflation environment. D) provide accurate answers only in a high-inflation environment.