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pirex pirex
wrote...
Posts: 634
6 years ago
In the presence of asymmetric information, production efficiency is assured when the principal and agent share the profit.
True or False? Provide an explanation.
Textbook 
Microeconomics

Microeconomics


Edition: 6th
Author:
Read 67 times
1 Reply
And if you call, I will answer
And if you fall, I'll pick you up
And if you court this disaster
I'll point you home

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Replies
wrote...
6 years ago
False. Since the agent faces full marginal cost but receives only a fraction of the marginal benefit, joint profit is not achieved.
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