The primary reason why individuals are willing to pay entrepreneurs to organize production is
a. that they have to guarantee that the entrepreneur will make a profit
b. they avoid taxation when activities are organized by someone else
c. that it is better for businesses to pay taxes than individuals
d. that it reduces transaction costs
e. that entrepreneurs are more vulnerable in the case of the owner
D
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A country experiencing an international financial crisis will likely
A) be able to maintain growth and prosperity in its domestic economy, but its export sector will suffer. B) see an increase in foreign direct investment. C) see an increase in portfolio investment. D) encounter difficulty in sustaining its economic growth rate.
The quantity effect of a price reduction causes:
A) a decrease in revenue because of a lower price. B) an increase in revenue because of increased sales. C) an increase in labor demand due to increased sales of the product. D) a decrease in labor demand because of a lower price of the final product.