Three difficulties that limit the usefulness of ownership in resolving incentive problems are:
A) wealth constraint, free riding and bundling.
B) risk aversion, free-riding and conflict of interests.
C) wealth constraints, risk aversion and bundling.
D) wealth constraints, risk aversion and free-riding.

Question

Quizplus · Accepted Answer

Wealth constraints can limit the ability of individuals to take ownership and invest in a project, risk aversion can lead individuals to avoid taking on risky projects even when they have ownership, and free-riding can still occur even when ownership is present as individuals may still rely on others to do the work. Bundling is not directly related to the limitations of ownership in resolving incentive problems.

Three Difficulties That Limit the Usefulness of Ownership in Resolving