Managerial Economics 12th Edition by Mark Hirschey

Exercise 1

Organization Structure. Determine whether each of the following statements is true or false. Explain why.
A. A vertical relation is a business connection between companies at the same point along the production-distribution chain.
B. A work slowdown due to an unexpected strike by unionized workers is a type of decision cost.
C. A merger between rival retailers Wal-Mart and Target would be horizontal in nature.
D. When a corporation files for bankruptcy, it is an admission that the organization was unable to minimize transaction costs.
E. Because the Internet allows customers to lower information costs, it will have the obvious long-run effect of reducing costs and boosting corporate profits.