The principal-agent problem suggests that
A) principals and agents always have the same goals.
B) principals and agents will never have the same goals.
C) principals and agents are more likely to have the same goals if the principal gives the agent flexibility to make his own decisions.
D) principals and agents are more likely to have the same goals if the agent's pay is tied to satisfying the principal's goals.
D
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The net-export effect of contractionary monetary policy is
A) the appreciation of the value of the dollar and a resulting decrease of U.S. net exports. B) the depreciation of the value of the dollar and a resulting increase of U.S. net exports. C) the appreciation of the value of the dollar and a resulting increase of U.S. net exports. D) the depreciation of the value of the dollar and a resulting decrease of U.S. net exports.
From 1998 to 2010, the cost of building a nuclear plant increased from $3 billion to $10 billion. If the marginal cost of producing electricity stays the same, then the average fixed cost of producing electricity ________ while the average total cost of producing electricity ________.
A. increases; increases B. decreases; stays the same C. increases; stays the same D. decreases; increases