Question

Larry is the sole owner and employee of Complete Time Repair, Inc., a business specializing in the repair of a wide variety of timekeeping devices. Irving is a collector of antique cuckoo clocks. Irving drops by Larry’s office and asks whether he can fix an antique black forest cuckoo clock that has a broken spring. Larry says that he has repaired many similar cuckoo clock springs in the past and tells Irving his cost is $500 for the service. A week later, Larry finds Irving’s cuckoo clock in his mailbox with a note that says “good luck, Irving.” Larry has a busy schedule, and would like to start work immediately, but decides to wait until he obtains a signed contract from Irving. Discuss the possible costs and benefits of Larry’s decision.