Author Question: A food company trying to increase its profits by expanding in to the soft drinks business is an ... (Read 45 times)

NClaborn · **on:** Jul 1, 2018

A food company trying to increase its profits by expanding in to the soft drinks business is an example of
a. Economies of scale
b. Economies of Scope
c. Diseconomies of Scale
d. Diseconomies of Scope

Question 2

Armpit Homunculus Prescott Pharmaceuticals is facing class action suit over side effects caused by its latest growth supplement. The lawyers representing the class are asking 200 million because they claim Prescott knew about and hid the fact that the supplement caused Armpit Homunculus. Prescott claims it had no foreknowledge of this and can take their chance at trial where they expect a 50 million payment. Just before the trial date, an internal Prescott email is discovered in which Dr. Colbert, D.F.A. is joking about how hideous the armpits will be on all these giants.. How does this affect the likely cost of settling the case?

trog · **Reply #1 on:** Jul 1, 2018

Answer to Question 1

b

Answer to Question 2

The disagreement value for Prescott fell because a trial jury would likely find this email to undermine the credibility that Prescott was unaware of the side effect. We expect the class to do better.