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roa https :// aka ur edu/porta ste 53 ct a c20f-4329-a8%289 4a80d67/tool/3601daae 4494-495-b d O e ECN202-Summer 2018 018 > PROBLEM SETS & EXAMS Week 1 Problem Set how Feedback I Table of Contents art 3 of 3 -Chapter 6 uestion 10 of 13 1.0 Points Which of the following statements are correct regarding the difference between markets and firms? A. Transactions within firms operate as contracts. Market transactions are not contracts. B. Working in a firm involves accumulation of firm-specific assets that will be lost if the connection to the firm is severed. C. Markets involve a decentralization of power, while firms represent a concentration of economic power. D. It is possible to employ division of labour within firms, while it is not possible in markets. Save Eit

Solution

Which of the following statements are correct regarding the difference between, markets and firms?

Ans. D. It is possible to employ division of labor within firms, while it is not possiblein markets.

As there are limited number of people in the firm, they can enjoy the division of labor within firms.But due to large number of people in the market the division of labor is not possible in markets.