Suppose general motors is trying to hire a small firm to


Suppose General Motors is trying to hire a small firm to manufacture the door handles for Buick sedans.  The task requires an investment in expensive capital equipment that cannot be used for any other purpose. Why might the president of the small firm refuse to undertake this venture without a long-term contract fixing the price of the door handles?

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Business Economics: Suppose general motors is trying to hire a small firm to
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