Production Through the Firm Is Often More Efficient Than Market

question 130

Multiple Choice

Production through the firm is often more efficient than market exchange when

• A)production requires many transactions among many resource owners
• B)production requires few transactions between two resource owners
• C)the cost of transacting business through market relations is less than the cost of undertaking the same activity within the firm
• D)inputs are easily identified, measured, priced, and hired
• E)the costs of determining inputs and negotiating contracts are low

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Definitions:

Life-giving Instinct

An innate or natural drive in living beings to reproduce or engage in behaviors that sustain life or promote well-being and survival.

Thanatos

In psychoanalytic theory, it represents the death drive, postulated by Freud as a basic human instinct oriented toward self-destruction and destructiveness.

Eros

In Freudian theory, the constructive, life-giving instinct.

Social Learning

The process of acquiring new behaviors through observation and imitation of others.