A free market can be defined as a market structure where all exchanges are voluntary, and prices are free to fluctuate. Does a perfectly competitive market qualify as a free market?
What will be an ideal response?
There is very little government control or coercion in such a market and hence the government does not tell market participants what to do. In a perfectly competitive market, the equilibrium price and quantity are determined through the forces of demand and supply, and without any government intervention. Hence, perfectly competitive markets qualify as free markets.
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When demand is relatively inelastic, a 5% increase in price will:
a. increase total revenue by more than 5%. b. increase total revenue by less than 5%. c. decrease total revenue by more than 5%. d. decrease total revenue by more than 5%.
The word "theory" means the same to the scientist as it does to the man on the street
a. True b. False Indicate whether the statement is true or false
The long-term financing dimension of financial management ________.
A) deals with the selection, issuance, and management of long-term debt and equity B) is unaffected by currency changes because everyone borrows in U.S. dollars C) focuses on the analysis of investment opportunities D) is independent of the capital structure of an MNE
If Risky, Riskier, and Riskiest Insurance decided to begin charging all of its auto insurance clients the same premium, what would eventually happen?
a. They would have only safe drivers. b. They would have only dangerous drivers. c. They would have an equal blend of safe and dangerous drivers. d. They would have only medium-risk drivers.