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The Theory of Contestable Markets Is Offered to Identify the Relevant

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Essay

The theory of contestable markets is offered to identify the relevant market structure for the deregulated transportation environment. Explain the theory.


Definitions:

Forward Trades

Non-standardized contracts between two parties to buy or sell an asset at a specified future date for a price agreed upon today.

Forward Market

A platform for trading financial agreements that are negotiated presently but fulfilled in the future.

Collection Float

The time gap between when a check is deposited and when funds are made available in the account, affecting the company's cash flow.

Purchasing Power Parity

An economic theory that compares different countries' currencies through a basket of goods approach to find the relative values of the currencies.

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