Personal injury lawyers may be paid a contingency fee equal to a percentage of the amount awarded. The lawyer receives payment only if his or her client wins the case and is awarded a sum of money. Lawyers in other types of cases are often paid on an hourly basis. Use the principal-agent relationship to assess the merits and drawbacks of each type of fee arrangement from the client's (i.e., the principal's) perspective. Be sure to discuss incentive effects.
Answer to relevant QuestionsSuppose that an employee has two tasks to perform, assembling machinery and evaluating quality. Suppose that the supervisor can only observe how many machines the worker has assembled. Under what conditions should the ...Explain why you tend to find more shirking, more corruption, and more inefficiency in large firms than you do in small firms. Explain why you tend to find more shirking, more corruption, and more inefficiency in government ...Under what conditions are the two strategies of low cost and high quality a tradeoff? Under what conditions would the efficient frontier not be an appropriate picture of the two strategies?Use what you know about Starbucks and apply the VRIO/VRIN approach to evaluate Starbucks, as you know it. Use the five forces model to evaluate Starbucks. Is the five forces model different from the VRIO model? ExplainIn the book, Naked Economics, the author says, “Prices are like giant neon billboards that flash important information.” (p.12) Describe the types of information that market prices provide. What role does the ...
Post your question