Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Assume that in the market there exist two types of workers where the principle cannot distinguish types. The two types only differ with respect to the disutility of effort. The disutility is either e^2 or 2e^2.
The utility function for worker one is
U^1(w,e) = w - e^2
and for worker two
U^2(w,e) = w - 2e^2
both types of workers have reservation utility zero
The probability that the worker is of type 1 is q = 1/2
An interested firm is risk neutral and has profits Π (w,e) = e - w
a) Which is the good high productive worker and which is the low productive worker
b) Derive the optimal contract for the firm if it had perfect info about the workers type. What effort levels are demanded and what wages paid. Calculate the firm's profits of both types were employed
c) Formulate the problem when an adverse problem is present
d) Derive the second best contract and calculate the firm's profits
e) Compare the cases of symmetric and assymetric info
Problem: i) The inverse market demand curve for a Stackelberg leader and follower is given by P = 10 - Q. If each has a marginal cost of $4, what will be the equilibrium qu
Commodities A) It is well documented that commodity prices are very volatile when compared to other asset classes. Discuss factors that cause volatility in the commod
Environmental economics goes back to the 19th century. Economists who research the planet are mainly worried with the idea of externalities, rare organic sources, and with the pro
if the marginal production of labor is rising, is the marginal cost of production rising or falling? Briefly explain
The prevention of major swings in economic activity can be handled most easily by the
Privatisation in the narrow sense can take several forms: a) Total Denationalisation: This implies complete transfer of ownership of apublic enterprise to private hands. Some
Strategic Importance of Supply Chain Management This describes the scope of supply chain management (SCM), including the management of procurement, logistics and materials. It
What is "high-powered money"? The "high-powered money" is the similar as monetary base, which is defined, at the minimum, as the sum of the currency in circulation (banknotes
what is comparative advantage
Average product and marginal product: Average product (AP) is the output per unit of the variable factor employed. In other words, it is the productivity of the variable facto
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd