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What Is the Hold Up Problem

Question 19

Multiple Choice

What is the hold up problem?


A) The ability of a worker to negotiate a wage increase causes deadweight loss.
B) Sunk investments in firm specific training are vulnerable to exploitation by workers.
C) Sunk investments in general training are vulnerable to exploitation by firms.
D) Workers do not spend enough obtaining general human capital.
E) Firms overinvest in firm specific human capital.

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