In the short run, the relevant costs for a firm to consider whether to shut down production are:

What is the main rationale economists provide for assigning government the responsibility of protecting people against foreign aggressors?

A) It would be too dangerous to allow citizens to keep and bear arms for the purpose of forming militias to defend their communities. B) Most people are patriotic only when the government is involved. C) "National defense" must by necessity be nationalized. D) People will not risk their lives unless government requires them to do so. E) Private providers could not exclude non-payers from the benefits.

A good salesperson can sell $100,000 worth of goods, while a poor one can sell only $10,000 worth of goods. Job applicants know if they are good or bad, but the firm does not. A firm will offer job applicants a choice between a fixed salary of $2,000 or a commission on the sale. Assume risk-neutral salespersons and no opportunistic behavior. Given that the firm wants to distinguish a prospective

good salesperson from a poor one, what should be the commission on sales? A) Commission should be larger than 50%. B) Commission should be larger than 40%. C) Commission should be between 2% and 20%. D) Commission should be smaller than 2%.