Chapter 14 - Transaction Costs, Imperfect Information, and Behavioral Economics

competitive model

The ________ implies that all market players are fully informed on the prices and availability of all inputs, outputs, and manufacturing processes.

acceptable inputs

When the expenses of locating ________ and bargaining for each individual contribution are considerable, the customer saves money by buying the final product from a company.

Market pricing

________, on the other hand, coordinates transactions between businesses, whereas managers coordinate activity inside enterprises.

outside suppliers

The term outsourcing refers to a firm that buys inputs from ________.

Vertical integration

________ refers to a company's growth into phases of manufacturing that are sooner or later than its core competencies.

Outsourcing

firm that buys inputs from outside suppliers

Market pricing

________, on the other hand, coordinates transactions between businesses, whereas managers coordinate activity inside enterprises.

individual contribution

When the expenses of locating acceptable inputs and bargaining for each ________ are considerable, the customer saves money by buying the final product from a company.