Agents prefer a behavior-based contract when
A)they are inclined to take more risks.
B)job outcomes are more measurable.
C)they desire higher compensation.
D)outcome uncertainty is high.
E)jobs become less programmable.

Question

Quizplus · Accepted Answer

When outcome uncertainty is high, it's difficult to measure performance based on outcomes alone, making a behavior-based contract more appealing as it focuses on the actions and behaviors of the agent rather than just the outcomes.

Agents Prefer a Behavior-Based Contract When