When an Organization Is Forced to Rely on a Small

question 8

Multiple Choice

When an organization is forced to rely on a small number of trading partners, the risk of ________.

• A) bounded rationality increases
• B) bounded rationality decreases
• C) opportunism decreases
• D) opportunism increases

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Definitions:

Perpetuity

An annuity whose payments continue forever.

Compounded Monthly

A method of calculating interest where the interest earned each month is added to the principal, increasing the amount on which future interest is computed.

Purchase Agreement

A legal document outlining the terms and conditions of a purchase between a buyer and a seller.

Compounded Monthly

The process of adding interest to the principal sum of a loan or deposit, or compound interest, on a monthly basis.