Initially Monitoring Costs Are Incurred by the Principal,however,ultimately Agents Will

question 18

True/False

Initially monitoring costs are incurred by the principal,however,ultimately agents will bear the monitoring costs.

---

Definitions:

Consumer Surplus

The gap between the total price consumers are willing to pay for a good or service and the price they actually pay.

Producer Surplus

The difference between the amount producers are willing and able to supply a good for and the actual amount they receive (market price).

Consumer Surplus

Consumer surplus is the difference between the total amount that consumers are willing and able to pay for a good or service and the total amount that they actually do pay.

Producer Surplus

The difference between what producers are willing to accept for a good versus what they actually receive.