If partners are paid equal shares and they work independently of each other:
A)the last one to arrive has an incentive to shirk.
B)the first one to arrive has an incentive to maximize output.
C)each one has an incentive to maximize individual output.
D)each one will increase individual utility by reducing output.

Question

Quizplus · Accepted Answer

When partners are paid equal shares regardless of individual output, each partner can increase their utility by reducing their own effort, as their compensation does not depend on their individual contribution.

If Partners Are Paid Equal Shares and They Work Independently