What are the advantages and disadvantages of organizing economic activity within firms?
What will be an ideal response?
The advantages of organizing economic activity within firms include the ability to make command-and-control decisions along clear hierarchical lines of authority; coordination of highly complex tasks to allow for specialized division of labor; transaction-specific investments, such as specialized robotics equipment that is highly valuable within the firm, but of little or no use in the external market; and creation of a community of knowledge. The disadvantages of organizing economic activity within firms include administrative costs because of necessary bureaucracy; low-powered incentives, such as hourly wages and salaries; and the principal-agent problem.
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Indicate whether the statement is true or false
If in 1900 the Minnesota Supreme Court ruled that a minor can void a contract at any time during minority and, in 2014, the courts in Minnesota still follow this ruling, this is an example of
a. stare decisis. b. the bystander rule. c. statutory law. d. enabling legislation.
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A. $57.40 B. $47.13 C. $60.42 D. $73.10 E. $50.15
Model development should be left to quantitative analysts; the model user's involvement should begin at the implementation stage
Indicate whether the statement is true or false