Which One of the Following Best Exemplifies the Principal-Agent Problem

question 193

Multiple Choice

Which one of the following best exemplifies the principal-agent problem in the employer-employee relationship?

• A) A worker takes 20-minute coffee breaks although the employer allots only 15 minutes for this purpose.
• B) A worker is on the job 50 hours per week although only 40 hours are required for promotion.
• C) A worker opts for early retirement in response to the firm's incentive plan.
• D) A worker's productivity is independent of the wage paid.

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Definitions:

Harbaville Triptych

A Byzantine ivory triptych of the 10th century, known for its detailed carvings and religious iconography.

Mount Sinai

A mountain in the Sinai Peninsula of Egypt that is of great religious significance to Judaism, Christianity, and Islam as the place where Moses is believed to have received the Ten Commandments.

Biblical Figure

An individual whose life and actions are described in the Bible, significant in religious and historical contexts.

Moses

A prophet in Abrahamic religions who is traditionally credited with leading the Israelites out of Egyptian slavery and receiving the Ten Commandments.