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
The Cost Minimizing Input Choice - Assumptions Two Inputs: Labor (L) & capital (K) Price of labor: wage rate (w) The capital price - R = depreciation ra
what is the influence of an increase of migrants on the market supply labour
Explain why each of the following factors may influence the own price elasticity of demand for a commodity. (i) Consumer preferences, that is, whether consumers regard the commodi
inflation wide equality while deflation narrow it down due in aggree distify we answer with algement?
Question: (a) With reference to the characteristics of market structure, describe why the market for powdered milk in Mauritius is an appropriate example of monopolistic compe
remedies of unemployment
Basics of Theory of demand: The most famous approach in the history of consumer behaviour, after indifference curve approach, is the revealed preference approach. In the revea
disadvantages of monopsony
Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4
What is studying platform? Explain this term in brief. Studying Platform: A studying platform into modern economics comprises some basic economic principles or theories. Thi
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