Pizza at Home is a frozen pizza company that supplies several large grocery store chains. The managers of Pizza at Home are currently negotiating a four year contract with Saucy Pizza, a manufacturer of pizza sauce. Saucy Pizza will supply a specified quantity of canned tomato sauce to Pizza at Home over a four year period; however; Pizza at Home can ends its contract with Saucy Pizza at the end
of the first, second, or third years if Saucy Pizza does not supply quality tomato sauce. What can the manager of Pizza at Home do to avoid the end-game problem?
A) Inform Saucy Pizza that Pizza at Home will nominate them for a supplier industry award if they provide quality tomato sauce in all four years.
B) Pay Saucy Pizza in installments at the end of the first, second, and third years.
C) Pay Saucy Pizza in equal installments at the end of each of the four years.
D) Pay Saucy Pizza in full at the beginning of the first year.
A) Inform Saucy Pizza that Pizza at Home will nominate them for a supplier industry award if they provide quality tomato sauce in all four years.
You might also like to view...
The costs of the process of bargaining to reach a mutually satisfactory agreement are called negotiation costs
Indicate whether the statement is true or false
According to Monetarists, a direct substitution between cash balances and real goods results from a change in
A) investment spending. B) consumption spending. C) government spending. D) the money supply.
In a monetary system, people will exchange a good for
a. another good. b. a service. c. money. d. gold or other precious metals.
When a firm is able to put idle equipment to use by hiring another worker,
a. variable costs will rise. b. variable costs will fall. c. fixed costs will fall. d. both fixed costs and variable costs will rise.