In public school there has been a new contract system that is being offered to teachers,...

In public school there has been a new contract system that is being offered to teachers, they now have the choice to give up life contracts in exchange for increased pay, in this new system they get short term contracts that are renewed by employees based on performance. What asymmetric information problem can occur if only some school distrcts implement this program and others don’t. Use charts if needed

Solutions

Expert Solution

The obvious issue with this concept is when some schools don't implement this program. There can only be benefits for implementing the program, as the schools in that district will have updated and current performance reviews of qualified teachers. On the other hand, the information asymmetry occurs when a teacher might apply for a job from a school where the district did not implement the said system, to a school which demands current performance reviews and recent contract details. There would be no proof related to information for the employers of the new school that the man is qualified and ticks all boxes to earn a high paying short term contract.

Rahul Sunny answered 2 years ago

Next > < Previous

Related Solutions

Data on salaries in the public school system are published annually by a teachers' association. The...

Data on salaries in the public school system are published annually by a teachers' association. The mean annual salary of (public) classroom teachers is $53.2 thousand. Assume a standard deviation of $7.2 thousand. Complete parts (a) through (e) below. a. Determine the sampling distribution of the sample mean for samples of size 64. The mean of the sample mean is mu Subscript x overbarequals$ nothing. (Type an integer or a decimal. Do not round.) The standard deviation of the sample...

Your factory has been offered a contract to produce a part for a new printer. The...

Your factory has been offered a contract to produce a part for a new printer. The contract would last for three years, and your cash flows from the contract would be $5.01 million per year. Your upfront setup costs to be ready to produce the part would be $8.05 million. Your discount rate for this contract is 8.1%. a. What is the IRR? b. The NPV is $4.84 million, which is positive so the NPV rule says to accept the...

Your factory has been offered a contract to produce a part for a new printer. The...

Your factory has been offered a contract to produce a part for a new printer. The contract would last for three years, and your cash flows from the contract would be 5.08 million per year. Your upfront setup costs to be ready to produce the part would be $8.09 million. Your discount rate for this contract is 7.8% . a. What is the IRR? b. The NPV is $5.05 million, which is positive so the NPV rule says to accept...

Your factory has been offered a contract to produce a part for a new printer. The...

Your factory has been offered a contract to produce a part for a new printer. The contract would last for 3 years and your cash flows from the contract would be $5.11 million per year. Your upfront setup costs to be ready to produce the part would be $8.12 million. Your discount rate for this contract is 7.9%. a. What does the NPV rule say you should do? b. If you take the contract, what will be the change in...

Your factory has been offered a contract to produce a part for a new printer. The...

Your factory has been offered a contract to produce a part for a new printer. The contract would last for three years, and your cash flows from the contract would be $4.93 million per year. Your upfront setup costs to be ready to produce the part would be $7.93 million. Your discount rate for this contract is 7.6%. a. What is the IRR? b. The NPV is $4.87 million, which is positive so the NPV rule says to accept the...

Your factory has been offered a contract to produce a part for a new printer. The...

Your factory has been offered a contract to produce a part for a new printer. The contract would last for 3 years and your cash flows from the contract would be $5.23 million per year. Your upfront setup costs to be ready to produce the part would be $7.88million. Your discount rate for this contract is 8.2 %. a. What does the NPV rule say you should do? b. If you take the contract, what will be the change in...

your factor has been offered a contract to produce a part for a new printer. the...

your factor has been offered a contract to produce a part for a new printer. the contract would be for 3 years and your cash flow from the contract would be 5 million per year. Your up-front setup costs to be ready to produce the part would be 8 million. Your cost of capital for this contract is 8% a. what does the npv rule say you should do? b. if you take the contract what will be the change...

Your factory has been offered a contract to produce a part for a new printer. The...

Your factory has been offered a contract to produce a part for a new printer. The contract would last for 3 years and your cash flows from the contract would be $4.75 million per year. Your upfront setup costs to be ready to produce the part would be $7.78 million. Your discount rate for this contract is 7.6%. a. What does the NPV rule say you should do? b. If you take the contract, what will be the change in...

1.Your factory has been offered a contract to produce a part for a new printer. The...

1.Your factory has been offered a contract to produce a part for a new printer. The contract would last for three years, and your cash flows from the contract would be $ 4.94 million per year. Your upfront setup costs to be ready to produce the part would be $ 7.98 million. Your discount rate for this contract is 7.7 % a. What is the IRR? b. The NPV is $ 4.82 million, which is positive so the NPV rule...

1. i) Your factory has been offered a contract to produce a part for a new...

1. i) Your factory has been offered a contract to produce a part for a new printer. The contract would last for 33years and your cash flows from the contract would be $ 5.22 million per year. Your upfront setup costs to be ready to produce the part would be $7.86million. Your discount rate for this contract is 7.5%. a) The NPV of the project is ____ millions (Round to two decimals) (Also, SHOW HOW TO PUT IT IN THE...

Subjects