All of the Following Contribute to the Attainment of Efficiency

question 158

Multiple Choice

All of the following contribute to the attainment of efficiency in a competitive market except

• A)marginal benefit equals marginal cost because of the establishment of market equilibrium
• B)every consumer maximizes his or her utility.
• C)every producer seeks to get the minimum price he or she is willing to accept.
• D)every consumer consumes to the point where price equals marginal benefit.
• E)every firm produces to the point where price equals marginal cost.

Analyze the effect of price changes on firm's risk profile and value.

Explain the concept of a risk profile and how it is influenced by market variables.

Detail the process and purpose of financial engineering in managing risk.

Recognize how businesses use financial instruments to hedge against price fluctuations in commodities.

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Definitions:

Evaluative

Pertaining to the appraisal or assessment of the value, significance, or status of a subject.

Descriptive

Pertaining to observations and analyses that aim to summarize and describe the characteristics of a dataset without making inferences or predictions.

Open-Ended

Questions or problems that allow for multiple or complex answers, encouraging a depth and breadth of response.

Facts

Information that is empirically proven to be true and verifiable.