Natalie can produce 6 shirts in a day, or cook three meals. Her opportunity cost of producing a shirt is 2 meals

Explain why a firm may hire managers to operate outlets near the firm's headquarters, but may sell franchise rights for the outlets located greater distances from the headquarters. (With a franchise, the firm sells a brand name and a method of doing business to someone who then owns and operates the outlet.)

What will be an ideal response?

Suppose that a labor union negotiates an increase in wages of 4 percent for the coming year because annual inflation for the past five years has been 4 percent. The expectations formed by the union are:

a. pessimistic expectations. b. deductive expectations. c. rational expectations. d. adaptive expectations. e. optimistic expectations.