There is an Italian soccer player who makes more than $10 million a year. Why?
The owners of the team must believe he adds more than $10 million a year to their revenue. Otherwise, they would be unwilling to pay this price. Just as in the United States, athletes who increase fan interest, ticket sales, and television revenue can command high salaries.
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If the present value equation used to calculate the price of a stock you are considering buying is "[$12 / (0.05 - 0.02)], which of the following is correct, assuming that dividends will grow at a constant rate?
A) The dividend is $12 per share, the dividend growth rate is 2 percent, and the interest rate is 5 percent. B) The stock price is $12, the dividend growth rate is 5 percent, and the interest rate is 3 percent. C) The dividend is $12 per share, the dividend growth rate is 5 percent, and the interest rate is 2 percent. D) The stock price is $12, the dividend growth rate is 2 percent, and the interest rate is 5 percent.
People hold money even during inflationary episodes when other assets prove to be better stores of value. This can be explained by the fact that money is
A) extremely liquid. B) a unique good for which there are no substitutes. C) the only thing accepted in economic exchange. D) backed by gold.
The ocean remains one of the largest unregulated resources for each of the following reasons except
a. many countries have access to the ocean. b. it is difficult to get international cooperation among countries that hold different values. c. the oceans are so vast that enforcing any agreements would be difficult. d. All of the above are reasons the ocean remains one of the largest unregulated resources.
When the price of a product is increased 10 percent, the quantity demanded decreases 15 percent. In this range of prices, demand for this product is:
A. inelastic. B. elastic. C. cross-elastic. D. unitary elastic.