Which of the following is true of the FDIC?
a. It controls the operations of all commercial banks in the U.S.
b. It exists only in the countries of North America and Europe.
c. It covers depositors against losses up to $500,000 in a bank account.
d. It is a federal agency that insures bank deposits in commercial banks.
e. It is a financial institution that uses cost-plus pricing.
d
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Generic Drug Industry Dynamics When a brand name drug's patent protection expires, many generic producers are usually ready to enter the market. These firms' products are close substitutes, they have similar production technologies, the regulatory
hurdles to enter are not so great, and, within a few months, there are plenty of rivals. What would you predict for the profitability during these first few months after generic drug entry?
If barriers to entry exist in the market for a product, then:
a. the costs of entry and exit are relatively low. b. there will be few close substitutes of the product in the market. c. firms will be incurring losses in both the short run and the long run. d. firms will tend to have relatively less monopoly power. e. the existing firms will quit the market in the long run due to mounting losses.