1. Supposed that you represent the shareholder board of Apple Inc. and decide to elicit high CEO effort to help the company:

What will be your incentive contract plan (e.g. bonus, stock option…etc.

Given your answer in a, if Apple does not perform as expected (say iphone X is not popular), what criticism of the incentive contract plan can you see? 

2. Please apply demand and supply analysis in CH 2 to answer the following questions related to the U.S. real estate market:       

What will be the impact on residential real estate market if the Fed raises the interest rate again in this year? Please state the leftward/rightward shift on either demand/supply curve and comment on the equilibrium price change.  

If a price ceiling on real estate agency commission is limited at 1% only, what will be the impact on new market equilibrium price and quantity of residential real estate market? ? Please state the leftward/rightward shift on either demand/supply curve and comment on the equilibrium price change.        

3. Using optimization theory in Chapter 3, please comment on the following quotation:

“If Congress cuts out the NASA space station, we will have wasted all the resources that we have already spent on it. Therefore, we must continue funding it.”