The Probability That a Business Is Engaged in Exporting Tends

question 28

Multiple Choice

The probability that a business is engaged in exporting tends to ________.

• A)decrease with the size of the firm
• B)increase with the product life cycle
• C)decrease with the product life cycle
• D)increase with the size of the firm

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Definitions:

Pablo Picasso

A Spanish painter, sculptor, printmaker, and influential artist of the 20th century, known for co-founding the Cubist movement.

Derived Demand

The demand for a resource that depends on the demand for the products it helps to produce.

Stock Options

Financial derivatives that grant the holder the right, but not the obligation, to buy or sell a stock at a specified price within a certain time frame.

Principal-Agent Problem

(1) At a firm, a conflict of interest that occurs when agents (workers or managers) pursue their own objectives to the detriment of the principals’ (stockholders’) goals. (2) In public choice theory, a conflict of interest that arises when elected officials (who are the agents of the people) pursue policies that are in their own interests rather than policies that would be in the better interests of the public (the principals).