Exam 10: Organizing Production

The implicit rental rate for capital includes the

One of the ways of coping with the principal-agent problem is

What is an incentive system?

The market for wheat is an example of

In the personal computer (PC) market in the first half of 2008, Hewlett-Packard maintained its worldwide No. 1 ranking at a market share of 19.1 percent. Dell's market share was 16 percent and Acer held onto third place with a 9.5 percent share, and Lenovo maintained fourth place, with a 7.9 percent share. What type of market structure would the market for PCs represent?

-Suppose there are ten firms that occupy the Odell, Oregon cherry pie market. The market share of each firm is listed in the above table. a) What is the four-firm concentration ratio in this market? b) What is the Herfindahl-Hirschman Index for this market? c) If Firm H and Firm A merge, what is the new Herfindahl-Hirschman Index for this market? d) A severe winter causes every firm except A, B, and E to close. With only these three firms operating, Firm A's market share is 71 percent, Firm B's market share is 23 percent, and Firm C's market share is 6 percent. What is the Herfindahl-Hirschman Index for this market now?

Mr. Sweet opened a candy store. He rented a building for $30,000 a year. During the first year of operation, Sweet paid $40,000 to his employees, $10,000 for utilities, and $20,000 for goods he bought from other firms. His total revenue was $135,000. Sweet's best alternative to running this candy store is to work for Wal-Mart as a sales associate for $15,000 a year. What is Sweet's total opportunity cost?

Any method of producing a good or service is ________. It ________ the maximum profit that a firm can make.

Costs to the firm arising from reaching agreements on input prices with suppliers and then ensuring that terms of agreements are fulfilled, are called

-The table above shows sales of the firms in the chocolate industry. The four-firm concentration ratio in the industry is

The accountant for Muzhi's Sushi claims that Muzhi has accomplished "economic efficiency." This means that Muzhi's Sushi

For monopoly

Economies of scope has to do with lowering production costs by increasing the quantity of a product produced, whereas economies of scale has to do with lowering production costs by producing several products within the same firm.

A corporation ________ taxes on its profits and its stockholders ________ taxes on any dividends made to them by the company.

-The above table shows the market shares for all the landscaping services in a suburban area. A merger between the three largest firms would

Kansas Power and Light, the only supplier of electricity in Kansas, is an example of a firm in what type of market?

-The above table shows the market shares for all the landscaping services in a suburban area. A merger between firms E and F would

If the four-firm concentration ratio is a very small number, then

The vast majority of all business sales are accounted for by

The correct ranking of the four basic market structures from low (Herfindahl-Hirschaman Index) HHI to high HHI is