Why does it seem to be more difficult for investors to measure the capital stock of a firm like eBay rather than a firm like Ford Motor Company? Explain
What will be an ideal response?
Ford Motor Company is likely to have more physical assets like factories, machines and equipment that are easy to measure in market terms. However, a company like eBay may have few such physical assets since a large part of the value of their business is their good will - their reputation for conducting honest transactions and minimizing fraud.
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A market for a product reaches equilibrium when
A. buyers intend to buy a quantity equal to the quantity that sellers intend to sell. B. the actual quantity bought by buyers equals actual quantity sold by sellers. C. the price rises further after there is a surplus. D. price falls further after there is a shortage.
If all Pareto improvements have been made
A) the result is increased government regulations. B) the outcome is Pareto efficient. C) consumer surplus is maximized. D) monopolists are unhappy.
With a price floor:
A. producer surplus will increase if profits increase. B. producer surplus will increase is profits fall. C. producer surplus will decrease if profits increase. D. producer surplus always decreases.
Arbitrage is the act of buying low in one market and selling high in another market
a. True b. False Indicate whether the statement is true or false