A severe drought has devastated cocoa plants, causing an increase in the price of chocolate. In the market for chocolate chip cookies
A) a surplus will arise.
B) supply has decreased and price has increased.
C) quantity has decreased and price has decreased.
D) quantity demanded has increased.
B
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Refer to Figure 4-3. If the market price is $3.50, what is the maximum number of ice cream cones that Kendra will buy?
A) 1 B) 2 C) 3 D) 4
A consequence of an incentive contract for employees is that
a. employees must incur additional risk b. employee level risk is reduced c. employer level risk is reduced d. there are no risk related consequences
Nearly half of the federal government's tax revenues come from
A. Individual income taxes. B. Customs, whiskey, and tobacco taxes. C. Corporate income taxes. D. Social Security payroll taxes.
Assume we have a stock currently worth $50. We also assume the interest rate is zero, and we can buy options for this stock with a strike price of $50. If the stock can rise or fall by $10 with equal probability over the option period, and the option cannot be exercised until the expiration date, what is the time value of the option?
A. $5 B. $50 C. $40 D. $10