The goal of any monopolist is to maximize:
a. economic profits.
b. normal profits.
c. price.
d. consumer welfare.
e. output.
a
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What government agency has the option to purchase government bonds issued by the U.S. Treasury?
A) the IRS B) the Commerce Department C) the Federal Reserve D) the Congressional Budget Office
The law of supply states that other things remaining the same, a decrease in the price of a kayak leads to
A) a decrease in the supply of kayaks. B) a decrease in the quantity of kayaks supplied. C) an increase in the supply of kayaks. D) an increase in the quantity of kayaks supplied. E) an increase in the supply of kayaks and a decrease in the quantity of kayaks supplied.
What three factors regarding differences in interest rates on similar bonds can prevent the interest parity condition from holding?
What will be an ideal response?
Two bonds of equal risk are for sale on the secondary bond market. The two bonds have the same face value, and both mature in 10 years. Bond A pays $10 per year and bond B pay $15 per year. Which bond will sell for a higher price?
A) Bond A B) Bond B C) They will sell for the same price. D) The relative prices will depend on the expected interest rate over the next 10 years.