In perfect competition
A) the market demand curve and the individual's demand curve are identical.
B) the market demand curve is perfectly inelastic while demand for an individual seller's product is perfectly elastic.
C) the market demand curve is perfectly elastic while demand for an individual seller's product is perfectly inelastic.
D) the market demand curve is downward sloping while demand for an individual seller's product is perfectly elastic.
Answer: D
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The yield on a thirty-year Treasury bond is 8% at the same time as the yield on two-year Treasury note is 5%. This occurrence
A) indicates that the yield curve is downward sloping. B) is well explained by the segmented markets theory. C) is largely explained by the favorable tax treatment of Treasury notes. D) indicates that the bond market is anticipating that inflation will fall.
Scott used $4,000,000 from his savings account that paid an annual interest of 5% and a $60,000 loan at an annual interest rate of 5% to purchase a hardware store. After one year, Scott sold the business for $4,100,000 . His economic profits is:
a. $300,000 b. $100,000 c. $97000 d. None. He runs an economic loss of $103,000