In the Textbook,there Is an Example of a Software Firm

question 8

Multiple Choice

In the textbook,there is an example of a software firm in which the managers provided a financial incentive to get rid of software bugs.The result was that software writers added more bugs into the software.This example shows that

• A)financial incentives should never be used.
• B)most employees are corrupt.
• C)incentives can create perverse effects.
• D)high-tech firms are unique.

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Definitions:

CPI

The Consumer Price Index is a metric that calculates the average prices of a selected group of consumer goods and services, such as healthcare, transportation, and food, using a weighted average system.

Price Index

A statistical measure that examines and tracks the changes in price levels of a basket of goods and services over time, used to measure inflation or cost of living changes.

GDP Deflator

A metric reflecting the price rates of freshly created, domestically made, final goods and services in an economic system.

Consumer Price Index

An indicator that evaluates the weighted average cost of a collection of consumer products and services like healthcare, food, and transportation.