Which of the following is true of exchange? a. The exchange value of a good is determined by the cost of the resources required to produce the good. b. The total output trading partners are able to produce is not influenced by whether the partners trade with each other. c. Exchange permits trading partners to expand their total output of goods and services as the result of greater specialization in areas where each has a comparative advantage. d. Exchange is a zero sum activity; if one party to an exchange gains, the other must lose an equal amount.

Steele bicycle manufacturing company currently produces the handlebars used in manufacturing its bicycles, which are high-quality racing bikes with limited sales. steele produces and sells only 10,000 bikes each year. due to the low volume of activity, steele is unable to obtain the economies of scale that larger producers achieve. for example, steele could buy the handlebars for $31 each: they cost $34 each to make. the following is a detailed breakdown of current production costs: after seeing these figures, steele's president remarked that it would be foolish for the company to continue to produce the handlebars at $34 each when it can buy them for $31 each. calculate the total relevant cost. do you agree with the president's conclusion?

Kando company incurs a $9 per unit cost for product a, which it currently manufactures and sells for $13.50 per unit. instead of manufacturing and selling this product, the company can purchase product b for $5 per unit and sell it for $12 per unit. if it does so, unit sales would remain unchanged and $5 of the $9 per unit costs assigned to product a would be eliminated. 1. prepare incremental cost analysis. should the company continue to manufacture product a or purchase product b for resale? (round your answers to 2 decimal places.)

Is exploiting a distinctive competence or improving efficiency for competitive advantage. (a) cooptation (b) coalition (c) competitive intelligence (d) competitive aggression (e) smoothing