"Because of rent seeking, a monopoly may end up making zero economic profit." Is the previous statement correct or incorrect? Why?
What will be an ideal response?
The statement is correct. Competition among rent seekers might cause the successful person striving to create a monopoly to pay so much in order to create the monopoly that, when taking into account the cost of creating the monopoly, the person makes only zero economic profit.
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Suppose the current price of DVDs is $16, while its base-year price is $11.50 . The value of the price index for the current year is approximately:
a. 139 b. 39 c. 25 d. 160 e. 172
Suppose that an internet-based program, Novus, wants to raise $10 million to expand its business operations. Describe how Novus can raise these funds directly through each of the follow options: issuing stock, issuing bonds, or obtaining a bank loan. Compare and contrast these three options.
What will be an ideal response?