Vertical contracts between manufacturers and retailers often aim to
a. Incentivize the retailers to undertake costly activities, which they otherwise may not realize the full benefits of on their own
b. Serve as a "signal" of the manufacturer's belief of the likely success of his product
c. Reimburse the retailer for the cost of managing an extended inventory
d. All of the above
d
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When a negative externality is present in a market, when a quota is imposed, it is:
A. efficient, because the market consumes the efficient level. B. not efficient, because individuals' net benefits from the amount set by the quota are different. C. efficient, because the net benefit of everyone at the amount set by the quota is equal. D. not efficient, because the marginal cost outweighs the marginal benefit for too many consumers at the amount set by the quota.