Producers may respond to a unit tax by _____
a. increasing the value of each unit
b. increasing the number of units sold
c. differentiating their product line
d. selling the product in bundles
a
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How does an import quota affect the domestic price of the import, the domestic consumption, the domestic production, and the quantity imported?
What will be an ideal response?
Why might stockholders be upset to find out that their company's profits that otherwise would have been distributed as dividends are instead invested in U.S. Treasury bonds?
What will be an ideal response?
Why would large department stores such as Home Depot rather face shortages than increase the prices of basic food and repair items in cases of natural disasters such as Hurricanes?
a. They do not want to increase sales b. They are maximizing sales c. They do not want to be viewed as unfair d. All of the above
If a 10-year Treasury bond pays 3.1% and a 10-year corporate bond pays 7.4%, what is the interest rate spread on this particular corporate bond?
a. 4.3% b. 7.4% c. 10.5% d. 22.9%