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Williamson, Wachter and Harris (1975) suggest promotion incentives within the firm as a substitute to morale-damaging monitoring, where promotion is based on objectively measurable performance. (Difference between these two approaches may be that former is applicable to a blue-collar environment whereasthe latter to a white-collar one).
Q. Causes for diseconomies of scale? The most significant cause for diseconomies of scale is the diminishing returns to management. As the output grows beyond certain level the
Legal Sanction: A monopoly as stated above may be the result of a government sanction. The government of a country may legally permit a private monopoly or monopoly in the public s
1. What kind of market structure is involved for the sale of medicines and vitamins? 2. What can be said about barriers to entry in this market? 3. Might there be a change in mar
The Budget line and its economic interpretation The indifference curve shows us consumer preferences but it does not show us the situation in the market place. Here the consu
Theories of wage determination Early theories about wages The earliest theories about wage determination were those put forward by Thomas Malthus, David Ricardo and Karl
Milton Friedman makes the demand for money a function of the real per capital permanent income. in this study the demand function for money is stated as; M/NPP= r( YP/NP) δ W
agency problems between shareholders and government
(i) Do the laws of economics still work today? (use the case discussed in class to answer this question or any other examples) (ii) Provide examples of three factors that can sh
LONG RUN EQUILIBRIUM FOR THE FIRM Since there is freedom of entry into the industry the surplus profits will attract new firms into the industry. As a result the supply of th
Drafting of Production Policy: Demand forecasts assists in drafting appropriate production policy so that there may not be any space between future demand and supply of a product.
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