The main reason Sears Roebuck became the largest retailer in the United States during the late nineteenth century was that:
a. it reduced a host of transaction costs which allowed higher profits to shareholders and lower prices to customers.
b. the railroad network improved substantially and charged higher rates for transporting goods.
c. the lack of competition lowered the cost of advertising and increased profits for shareholders.
d. his organization only interacted with the best wholesalers, distributors, and shippers in the business.
A
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A corporation is likely to "call" a bond if
A) it goes bankrupt. B) it has short-term liquidity problems. C) interest rates fall sharply. D) interest rates rise sharply.
Assume that a perfectly competitive firm faces a fixed wage rate of $4 and a constant per-unit cost of capital of $2. If the marginal product of labor and capital are 16 and 6, respectively, then to maximize profits the firm should
A) use relatively more labor. B) use relatively less labor. C) increase all inputs proportionately. D) decrease all inputs proportionately.