Reference no: EM13869603

Post your answer to two of the following questions. I am after an "in your experience" answer that you can share with the class, but the experience could be from your wife's job, your' mom's job, or your best-friend's brother-in-law's job. Protect privacy etc as necessary; don't divulge corporate secrets; don't post a confession to any felony crimes. I will delete any post that introduces the possibility of litigation. Keep your answers as brief as possible. I want you to read all other answers-so how long would you want your classmates' answers to be? If you error on the side of brevity, I will ask for more. Remember only answer two questions.

1. Consider a previous job and the system the firm used to solve the principal-agent problem. Did the compensation scheme solve or amplify the principle-agent problem? Did the compensation scheme create any moral hazards? If so, how did the firm (or the employees) deal with the moral hazards?

2. What role does economies of scale or scope play in your industry? What has your firm done to exploit economies of scale and scope? When answering this question, also address whether scale/scope affects the number and size of firms in the industry.