What Are the Two Major Limitations of Objective Incentive Payment

question 1

Multiple Choice

What are the two major limitations of objective incentive payment (OIP) schemes?

• A) OIP schemes encourage an emphasis on quantity at the expense of quality and the firm must use costly monitoring technology.
• B) Most professions have output that is easy to quantify and the firm must use costly monitoring technology.
• C) OIPs encourage shirking and the firm must use costly monitoring technology.
• D) OIP schemes do not encourage productivity as much as wages do and the firm cannot measure subjective quality.
• E) OIPs encourage an emphasis on quantity at the expense of quality and the firm cannot measure subjective quality.

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Definitions:

Market Investment

Allocating resources, often financial, into a market with the expectation of achieving a future financial return.

Drug Legalization

This concept involves removing legal prohibitions against drugs, potentially regulating and taxing their sale and use, similar to alcohol and tobacco.

Drug Prices

The cost at which medication or pharmaceuticals are sold to consumers or healthcare providers.

Drug Transactions

These are exchanges that involve the buying and selling of illegal substances or prescription medications without proper authorization.