When a firm buys on the marketplace what it cannot make itself,the costs incurred are referred to as:
A)switching costs.
B)network costs.
C)procurement.
D)agency costs.
E)transaction costs.

Question

Quizplus · Accepted Answer

The costs incurred when a firm buys on the marketplace what it cannot make itself are referred to as transaction costs. These costs include the direct costs of searching for and negotiating with suppliers, as well as indirect costs such as information asymmetry and opportunistic behavior.

When a Firm Buys on the Marketplace What It Cannot