An Example of a Way Employers Can Minimize Moral Hazard

question 115

Multiple Choice

An example of a way employers can minimize moral hazard is:

• A)monitor employees' computer activity.
• B)offer bonuses for consistent productivity.
• C)videotape the workplace.
• D)All of these are ways to minimize moral hazard.

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Definitions:

Technological Breakthrough

A significant innovation or discovery that dramatically advances technology or improves processes and products.

Profit-Maximizing Monopolist

A monopolist entity that aims to maximize its profits by setting prices where marginal costs equal marginal revenues, given its unique market power.

Price Discrimination

A pricing strategy where a seller charges different prices for the same product or service to different customers, based on factors like willingness to pay, location, or purchase volume.

Perfectly Inelastic

A demand situation where the quantity demanded does not change in response to price changes.