Long-Term Contracts

question 144

Multiple Choice

Long-term contracts:

• A) increase transaction costs and increase opportunism.
• B) increase transaction costs.
• C) can reduce opportunistic behavior.
• D) reduce transaction costs and increase flexibility.

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Definitions:

Competitive Strategy

An approach a business takes to differentiate itself from its competitors, focusing on strengths to provide better value to customers.

Potential Customers

Individuals or entities that are considered likely to purchase a product or service but have not yet done so.

Products

Goods or services offered by businesses to consumers, intended to satisfy needs or wants.

Rapid Response

The ability to react quickly and efficiently to unforeseen situations or emergencies.