Which of the following is an example of an ordering cost for goods held in inventory?
A) the cost of storage
B) the costs of securing the inventory
C) the opportunity cost of using funds to finance the inventory
D) the cost of the paperwork necessary to pay for each order
D) the cost of the paperwork necessary to pay for each order
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If a company's total costs per day increase from $200 to $400 by adding another worker, but its additional benefits are $300, it is sensible to add that additional worker
Indicate whether the statement is true or false
Issuing marketable permits to firms that produce a product with external costs will give the firms the incentive to
A) declare bankruptcy. B) buy and sell the permits amongst themselves. C) escape the problem completely. D) quit producing the output. E) increase the external cost because they no longer need to deal with the externality.
The Herfindahl-Hirschman index
A. is no longer applicable to the American economy. B. measures the degree of concentration within an industry. C. seldom goes above 100. D. falls as the degree of concentration rises.
Asymmetric information before a transaction takes place generates the problem of
A. bank runs. B. intermediation. C. flawed bank regulation. D. adverse selection.