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Robinson Crusoe Has Formed a Business That Sells Carved Gourmet

question 44

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Robinson Crusoe has formed a business that sells carved gourmet coconuts.He has hired five employees.The most senior is Friday,who manages the carving process.Monday is the newest employee.She collects the coconuts.Tuesday,as you might expect,takes calls from curstomers,oops,I mean customers,who are unhappy with their coconuts.Wednesday tosses finished coconuts into the sea,whereupon they drift to the wholesaler.Thursday sends smoke signals to the wholesaler extolling the virtues of the latest production run of nuts that are drifting across the bay.Which of the following functions in the value chain is Monday performing?


Definitions:

Herfindahl-Hirschman Index

An economic indicator that measures the level of concentration and competition within an industry.

Economies of Scale

Refers to the cost advantage experienced by firms when they increase their level of production. The advantage arises due to the inverse relationship between per-unit fixed cost and the quantity produced.

Oligopolistic

Pertaining to an oligopoly, a market structure with a few firms dominating the industry, leading to limited competition.

Herfindahl-Hirschman Index

A measure of market concentration to assess the level of competition within an industry.

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