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ECO 550 Midterm Exam Part 1 (A GUARANTEED)

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ECO 550 Midterm Exam Part 1 (A GUARANTEED) Question 1 4 out of 4 points A Real Option Value is: Selected Answer: An opportunity to implement cost savings or revenue expansion in a flexible ... business plan. Correct Answer: An opportunity to implement cost savings or revenue expansion in a flexible business plan. Question 2 4 out of 4 points The flat-screen plasma TVs are selling extremely well. The originators of this technology are earning higher profits. What theory of profit best reflects the performance of the plasma screen makers? Selected Answer: innovation theory of profit Correct Answer: innovation theory of profit Question 3 4 out of 4 points The Saturn Corporation (once a division of GM) was permanently closed in 2009. What went wrong with Saturn?Selected Answer: Saturn sold cars below the prices of Honda or Toyota, earning a low 3% rate of return. Correct Answer: Saturn sold cars below the prices of Honda or Toyota, earning a low 3% rate of return. Question 4 4 out of 4 points To reduce Agency Problems, executive compensation should be designed to: Selected Answer: create incentives so that managers act like owners of the firm. Correct Answer: create incentives so that managers act like owners of the firm. Question 5 [Show More]

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