4 of 29 Marks You inherited your uncle's bakery in a remote area. The bakery has to stay in the family, but you prefer to keep your job and hired a local manager. The profits of the bakery depend on the economy and on the manager's effort, according to the following table: Good economy Bad economy No effort $11,000 $4,000 High effort $23,000 $16,000 The good and bad economies have equal probabilities. When the manager makes no effort, he is running his own side business that is generating $1,000. Which of the following incentives avoids the principal-agent problem? O A 5% of the profit O B. 10% of the profit O C. None of the listed options. O D. A fixed salary of $3,000 Finish attempt