Which of the Following Statements About Outcome-Oriented or Behavior-Oriented Contracts

question 27

Multiple Choice

Which of the following statements about outcome-oriented or behavior-oriented contracts is true?

• A)Merit pay is an example of an outcome-based contract.
• B)Behavior-oriented contracts do not transfer risk to the agent.
• C)Outcome-oriented contracts do not require a compensating wage differential.
• D)Outcome-oriented contracts decrease the agent's risks.
• E)In behavior-based contracts,information asymmetry is not an important issue.

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Definitions:

Perceptual Set

A mental predisposition to perceive one thing and not another, influenced by expectations, emotions, and experiences.

Gestalt Psychologist

A psychologist who studies how people perceive and experience objects as whole patterns or configurations, not just as simple sums of their parts.

Negative Afterimages

A visual phenomenon where an image continues to appear in one's vision after the exposure to the original image has ceased.

Opponent-Process Theory

A psychological and neurological model that accounts for a wide range of behaviors, including color vision. This theory suggests that emotions are paired in a way that when one is activated, the other is suppressed.