Which of the Following Statements Is True About Specialized Assets

question 115

Multiple Choice

Which of the following statements is true about specialized assets?

• A) The value of a specialized asset significantly increases in its next-best use.
• B) When one firm must invest in specialized assets to supply another, mutual dependency is created.
• C) When substantial investments in specialized assets are required, firms prefer to contract it out to a supplier.
• D) A specialized asset is a flexible manufacturing technology that can be put to multiple uses.
• E) Using a specialized asset allows firms to switch their orders easily between suppliers.

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Definitions:

Sheep

Domesticated ruminant animals, typically kept as livestock for their wool, meat, and milk.

Classical Conditioning

A learning process that occurs when two stimuli are repeatedly paired; a response that is at first elicited by the second stimulus is eventually elicited by the first stimulus alone.

Responding Increases

The enhancement in the frequency or intensity of a behavior or reaction due to stimulation or reinforcement.

Pavlov's Experiment

A classical conditioning experiment by Ivan Pavlov demonstrating that dogs could be trained to salivate in response to a neutral stimulus when associated with food.