A Single Restaurant and a Chain Are Each Considering Whether

question 18

Multiple Choice

A single restaurant and a chain are each considering whether to set up their own delivery service or contract with Deliveroo. What factor would make it more likely that the single restaurant should outsource deliveries.

• A) Moral hazard.
• B) Potential for holdup.
• C) Lack of economies of scale.
• D) None of the above.

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Definitions:

Minimum Purchase

A specified smallest amount or number needed to be bought.

Single Equivalent Payment

A singular payment that consolidates multiple payments or installments into one, often seen in loan repayments or settlement agreements.

Principal And Interest

The principal is the original sum of money borrowed in a loan. Interest is the cost of borrowing that principal, typically expressed as an annual percentage rate.

Equal Payments

Fixed payments made consistently over the duration of a loan or mortgage agreement.