Which of the Following Is NOT a Reason That Markets

question 43

Multiple Choice

Which of the following is NOT a reason that markets usually lead to efficiency?

• A)People are naturally efficient.
• B)Individuals have incentives to offer what people want.
• C)Trade encourages efficiency.
• D)Inefficient firms will lose business.

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Definitions:

Franchise

A type of license that a party (franchisee) acquires to allow them to have access to a business's (franchisor) proprietary knowledge, processes, and trademarks to sell a product or provide a service under the business's name.

Cost Price Approach

A pricing method that determines the selling price of a product by adding a profit margin to the total cost of production.

Transfer Pricing

The pricing of goods, services, and intangibles transferred within divisions of a company or across affiliated entities to reflect market conditions.

Support Department

An organizational unit that provides essential services to other departments within an organization but does not directly contribute to profit.