A discount bond is also called a ________ because the owner does not receive periodic payments
A) zero-coupon bond
B) municipal bond
C) corporate bond
D) consol
A
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Explain what will happen to the equilibrium price and quantity of satellite TV service if the wages of the workers who provide the satellite TV service increase while at the same time the price of cable television service (a substitute for satellite
TV service) also increases.
According to a New York Times article, shoppers from New York City have played a game of "retail arbitrage" by shopping at malls in Northern New Jersey, a state where there is no tax on clothing and shoes
Even after accounting for transactions costs, shoppers could still save money on their clothing and footwear purchases. Source: Ken Belson and Nate Schweber, "Sales Tax Cut in City May Dim Allure of Stores Across Hudson," New York Times, January 18, 2007. Is the term "arbitrage" correctly used here? A) Yes, arbitrage applies even if no resale takes place; in this case the profits are pocketed by the customers themselves. B) No, "arbitrage" does not apply to markets that are not in the same geographic area. C) No, "arbitrage" means buying at a low price and reselling at a higher price but no resale takes place here. D) Yes, because shoppers were able to purchase items at lower prices even after deducting their transactions costs.
Explain why a monopolist does not have a supply curve.
What will be an ideal response?
Each firm in perfect competition:
A. follows the pricing decisions of other firms. B. follows the output of other firms. C. follows the reactions of competitors. D. sets quantity based on market price.