Significant Barriers to Entry Exist in _____ Market Structures

question 48

Multiple Choice

Significant barriers to entry exist in _____ market structures.

• A) perfect competition and monopolistic competition
• B) monopolistic competition and oligopoly
• C) oligopoly and monopoly
• D) monopoly and perfect competition

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Definitions:

Nondiversifiable Risk

A type of risk that affects all investments across the market and cannot be eliminated through diversification.

Diversifiable Risk

A type of investment risk that can be reduced or eliminated in a portfolio through diversification, as it is not correlated with market movements.

Risk Premium

The extra return expected by an investor for holding a risky asset, over and above the risk-free rate.

Discount Rate

The interest rate used in calculating the present value of future cash flows. It reflects the time value of money and risk.