The ________ of the term structure states the following: the interest rate on a long-term bond will equal an average of short-term interest rates expected to occur over the life of the long-term bond plus a term premium that responds to supply and
demand conditions for that bond. A) segmented markets theory
B) expectations theory
C) liquidity premium theory
D) separable markets theory
C
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Refer to the payoff matrix below. If Cruise R Us uses a mixed strategy, what probability for offering Specials should the firm use to equate Cruise the World's expected profits from offering a Special or not offering a special (No Special)?
Cruise R Us and Cruise the World compete in the cruise line industry. Each firm needs to determine if they are going to offer special cruise packages with special rates or not offer the specials. The above payoff matrix shows the firms' net economic profit for each set of strategies.
A) 0.33 B) 0.25 C) 0.75 D) 0.50
If a firm finds that its marginal cost is greater than its price, it
A. Should increase production. B. Is maximizing its profit. C. Is maximizing its total revenue. D. Should reduce production.
Refer to the above table. How many workers will this firm hire if the weekly wage rate is $900?
A. 28 B. 27 C. 29 D. 26
Refer to the information provided in Figure 2.5 below to answer the question(s) that follow.
Figure 2.5Refer to Figure 2.5. For this economy to move from Point C to Point B, ________ additional LCD TVs could be produced when the production of OLED TVs is reduced by 20.
A. exactly 30 B. exactly 60 C. fewer than 30 D. more than 30