Exam 15: Contracting,governance,and Organizational Form

Appendix: The principal advantage of an open bidding system for allocating telecommunications spectrum licenses was

Appendix: Research suggests that an auction for a private value item will yield the HIGHEST payout if:

Appendix: Sealed bids can be used in multiple rounds.How is this done?

Non-redeployable durable assets that are dependent upon unique complementary and perfectly redeployable assets to achieve substantial value-added will typically be organized as

​Expectation damages:

Appendix: An incentive-compatible revelation mechanism is

Appendix: Refer to Exhibit 15A-1. ​ Part C: What is the expected net profit under the simple profit sharing contract,and why would the partners adopt an incentive-compatible revelation mechanism (i.e.,an optimal incentives contract)?

Appendix: Common value auctions with open bidding necessarily entail

Buying electricity off the freewheeling grid at one quarter 'til the hour for delivery on the hour illustrates:

Agency problems appear in many settings within a firm.All of the following are examples,except which is NOT a good example of this problem?

What are the expected net profits to Johnson & Johnson in a pharmaceutical R&D joint venture with Amgen given the following joint profit payoffs.The joint profit payoffs are the difference between $180 and the sum of the cost realizations.Assume that the three columns are equally likely to occur,each row is equally likely to occur.Both Johnson and Johnson and Amgen can cancel the project and both will then earn $0 if the cost revelations give early warning of losses. The figures in parentheses represent costs associated with the Low,Moderate and High cost realizations,and all figures are in millions.

Which of the following are not approaches to resolving the principal-agent problem?

When someone contracts to do a task but fails to put full effort into the performance of an agreement,yet the lack of effort is not independently verifiable,this lack of effort constitutes a

Appendix: A Dutch auction implies all of the following except

Appendix: An incentive-compatible mechanism for revealing true willingness to pay in a private value auction is

Refer to Exhibit 15A-1. Part B: What are the expected net profits to each partner under the incentives contract?

Vertical integration may be motivated by all of the following except:

Appendix: Revenue equivalence theorem refers to equal seller revenue in which of the following pairs:

Which of the following is not among the functions of contract?

In the following sequential marketing game,is a threat by the manufacturer (Man)not to advertise a newly updated product unless the retailer (RET)promotes it a credible threat?