1. (5 points) Assume that for fast food restaurants like McDonalds, some stores are owned by franchisees (independent businesses who pay a franchise fee to McDonalds} and some stores are directly owned by MeDonalds who will hire the manager for these company owned stores. The manager at the 'anchise owned McDonalds is often the owner of the restaurant, and the manager of the McDonalds owned restaurant is a cmnpany employee who gets a at salary. In which case will there be a principalagent problem? Please explain 2. (5 points) Use of the internet for personal work reduces the productivity of workers and many rms make attempts at cracking down on this personal use of the internet in order to improve worker productivity. Is it worth making an attempt at completely eliminating personal use of a work computer and internet connection and taking all the steps that would be necessary to completely eliminate personal use of work computers? Please explain. 3. (5 points) Teletronics reported record prots of $100,000 last year and is on track to exceed those prots this year. Teletronics competes in a very competitive market where many of the rms are merging in an attempt to gain competitive advantages. Currently, the company's top manager is compensated with a xed salary that does not include any performance bonuses. Explain why this manager might nonetheless have a strong incentive to maximize the firm's prots