Vertically integrated firms can use transfer pricing
A) to avoid government price controls.
B) as a way to compensate managers for transferring among departments in a vertically integrated firm.
C) to avoid paying market prices for inputs.
D) to shift profit.
D
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Why do most firms in monopolistic competition typically make zero profit in the long run?
A) because the lack of entry barriers would compete away profits B) because the total market is not large enough to accommodate so many firms C) because firms do not produce at their minimum efficient scale D) because firms produce differentiated products
The law of demand implies that the demand curve
A) has a negative slope. B) has a positive slope. C) shifts to the right when the price of a good increases. D) shifts to the left when the price of a good decreases.