The parent company would want to reward managers based on division revenues because
a. The managers usually have the least information about their divisions
b. It would incentivize the otherwise clueless managers about the daily activities of their divisions
c. The managers usually have the best information about how to run their divisions
d. None of the above
c
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The textbook's example of urban traffic flows demonstrates the notion of single-minded pursuits of one's own best interest
A) creates traffic jams. B) interferes with achievement of the public interest. C) produces social cooperation under appropriate rules of the road. D) will not work to any single person's advantage. E) will work to some people's advantage but will harm the vast majority.
Suppose a competitive market is comprised of firms that face identical cost curves. The firms experience an increase in demand that results in positive profits for the firms. Which of the following events are then most likely to occur? (i) New firms will enter the market. (ii) In the short run, price will rise; in the long run, price will rise further. (iii) In the long run, all firms will be
producing at their efficient scale. a. (i) and (ii) only b. (i) and (iii) only c. (ii) and (iii) only d. (i), (ii) and (iii)