How is a firm's vertical scope determined?
A firm's vertical scope is determined by the costs of transacting in markets versus the costs of transferring goods or services between parts of the organization. These include the costs of coordinating volume flows of goods-in-process and organizing coordinated responses to uncertainty.
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Ted quits his $60,000-a-year job to be a stay-at-home dad. What is the opportunity cost of his decision?
A) the value he attributes to the joy of parenting B) at least $60,000 C) zero, since he will no longer be earning a salary D) depends on the "going rate" for stay-at-home dads
Which of the following are costs incurred by people trying to protect themselves from the effects of inflation?
a. menu costs and shoeleather costs b. menu costs but not shoeleather costs c. shoeleather costs but not menu costs d. menu costs but not shoeleather costs
Which of the following describes the impact of unions on wages?
a. The high wages negotiated by the union drive up wages in the nonunion sector by extension. b. Collective bargaining has the effect of lowering wages in general to keep more people employed. c. By restricting membership, the union drives up union wages and drives down nonunion wages. d. The union has the collective power to enforce equilibrium wages for everyone.
If the MRP of labor were $50 and the wage rate were $100,
A. exactly the right amount of labor is being used. B. not enough labor is being used. C. only half as much labor is being used as should be used. D. too much labor is being used.