Firms generally prefer not to outsource product design and manufacturing because:
a. these activities are common and standardized.
b. these operations are more or less static.
c. these operations involve a low investment.
d. these operations require investment in highly specific assets.
QUESTION 2To Schumpeter, the market process is called
A) dynamic externalities
B) static business formation
C) creative destruction
D) all of these choices.
QUESTION 3Which of the following is most likely to incorporate a great deal of economic rent?
a. sale of a bag of potato chips
b. salary paid to an employee at the local Home Depot
c. a soft drink sold by a vending machine
d. sale of a rare stamp
QUESTION 4_____ and _____ are major factors in de-integration, which act in opposite directions.
a. Vertical restraints; opportunism
b. Uncertainty; volumetric interdependence
c. Asset specificity; uncertainty
d. Volumetric interdependence; vertical restraints
QUESTION 5The ____ is at the center of the market process.
A) managers
B) shareholders
C) entrepreneur
D) none of these choices.