Suppose There Are 100 Identical Firms in the Rag Industry,and

question 114

Multiple Choice

Suppose there are 100 identical firms in the rag industry,and each firm is willing to supply 10 rags at any price.The market supply curve will be a

• A) vertical line where Q = 10.
• B) vertical line where Q = 100.
• C) vertical line where Q = 1000.
• D) horizontal line where Q = 1000.

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Definitions:

Guaranteed Investment Certificate

A secure investment that guarantees to return the principal amount plus interest at a specified rate.

Compounded Annually

Interest calculation method where interest is added to the principal at the end of each 12-month period.

Annual Rate of Decline

The percentage at which a value decreases over the course of one year.

Strip Bond

A debt security that has had its principal and coupon payments detached and sold separately as zero-coupon bonds.