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11Alexandr11 [23.1K]
3 years ago
5

A firm can produce steel with or without a filter on its smokestack. If it produces without a filter, the external costs on the

community are $ 500,000 per year. If it produces with a filter, there are no external costs on the community, and the firm will incur an annual fixed cost of $ 300,000 for the filter. Use the Coase Theorem to answer how costless bargaining will lead to a socially efficient outcome, if the property rights are owned by the community. A. the community will have an incentive to pay the firm some price above $ 300,000 (perhaps $ 499,999) to induce the firm to install the filter. B. The firm would install the filter at a cost of $ 300,000. C. the socially efficient outcome is for the firm to not install the filter
Business
1 answer:
Licemer1 [7]3 years ago
6 0

Answer:  B. The firm would install the filter at a cost of $ 300,000.

Explanation:

If the community owns the property rights, they would be able to demand that the firm pay the external cost of $500,000 per year.

If on the other hand the company installed a filter, it would cost them $300,000 but then they would not have to pay the community the $500,000.

The lower cost option would be to install the filter for $300,000 which is what the firm would do.

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Answer:

d. ​Both A&B

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A common value auction is a type of auction where certain information about the value of a product are available to some bidders and other sets of bidders have other information about the value.

DISPLAYING INFORMATION ABOUT A COMMON VALUE AUCTION IS GOOD FOR THE BIDDERS AS IT REDUCES THE RISK THEY FACE ESPECIALLY BEFORE BUYING THE PRODUCT AND FOR THE AUCTIONEER AS IT HELPS TO ATTRACT MORE BIDDERS.

3 0
2 years ago
Which of the following is a weakness of publicity? Publicity has high absolute costs. Publicity is difficult to receive good fee
Fittoniya [83]

Answer:

There is a lack of user control over publicity.

Explanation:

Publicity is the degree of awareness of a product, company or service. It is the movent of information from the source to the general public.

One of the weakness of publicity is the lack of control the user or source has over it. Once an information is given to the public they form a perception and spread it in a way that the original source cannot control.

The lack of control a user has over publicity can have adverse effects, for example when negative publicity is circulating in the market a company is operating, it can lead to loss of revenue.

7 0
3 years ago
​​​When organizations are in dynamic and uncertain environments, their effectiveness depends on being able to adapt quickly to c
viktelen [127]

Answer:

Organic

Explanation:

​​​When organizations are in dynamic and uncertain environments, their effectiveness depends on being able to adapt quickly to changing customer tastes and preferences, which requires a more organic design.

In a dynamic and uncertain environment a mechanistic design will be inapplicable but organic

An organic organization is best applied to businesses that apply a more open business structure which is needed in order to quickly respond to the dynamics (changes) and uncertainty in the business environment. The structure gives the organization the flexibility to deal with fast-paced environmental change and many different elements.

3 0
2 years ago
A nation's production possibilities curve is bowed out from the origin because: A. resources are not equally efficient in produc
Ilia_Sergeevich [38]

Answer:

The correct answer is option A.

Explanation:

A production possibility curve shows the different bundles of maximum possible two goods that can be produced using the given resources. The production possibility curve is concave to the origin.  

This shape of the curve is because of opportunity cost. We know that to increase the production of one commodity we need to sacrifice production of its alternative.  

The resources can not be perfectly substituted and the opportunity cost goes on increasing with the increase in output, that's why the production possibility curve is bowed out or concave to the origin.

5 0
3 years ago
A firm’s management analyzes financial statement’s so that: a. they can get feedback on their investing, financing, and working
Zepler [3.9K]

Answer:

d. a and b

Explanation:

A firm’s management analyzes financial statement’s so that:

Evaluating company's performance, by analyzing the financial statements in respect of various areas of financing, investing and operating activities, and then comparing the performance with past records and industries of same category.

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Correct answer

d. a and b

7 0
2 years ago
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