One of the Largest Categories of Exports from the United

question 384

Multiple Choice

One of the largest categories of exports from the United States is now pop culture: movies, music, TV programming, and videos. A direct conclusion from this information is that, compared to other countries, the United States has

• A) lower wages for producers of pop culture.
• B) a lower opportunity cost of producing pop culture.
• C) a higher opportunity cost of producing pop culture.
• D) higher wages for producers of pop culture.

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Definitions:

Margin

The difference between the selling price of a product and the cost of producing or purchasing it, or the collateral required to secure a loan or derivative position.

Zero Coupon Interest Rate

A rate of interest reflecting the discount from par at which zero-coupon bonds are sold. This rate is not paid annually but at maturity.

Arbitrage Profit

Profit earned from buying and selling the same asset in different markets to take advantage of differing prices for the same asset.

Stock Index

A measurement of a section of the stock market calculated from the prices of selected stocks, representing a specific market or sector.