An Individual Transferable Quota Is a Production Limit That

question 27

Multiple Choice

An individual transferable quota is a production limit that

• A)has a price equal to marginal cost.
• B)is assigned to every producer in the industry at a predetermined price.
• C)is assigned to an individual who must transfer the quota to anyone the government assigns.
• D)is assigned to an individual who is free to transfer the quota to someone else.
• E)has a price equal to marginal benefit.

---

Definitions:

Bought Deal

A financing arrangement where an investment bank buys an entire new issue of securities from a company and resells it to investors.

Underwriter

A person or organization that evaluates and assumes the risk of another entity, often involved in issuing new securities as part of public offerings.

Securities

Financial instruments that represent an ownership position in a publicly-traded corporation (stock), a creditor relationship with a governmental body or a corporation (bond), or rights to ownership such as options.

Floatation Costs

The expenses incurred by a company when issuing new securities, including underwriting fees, legal fees, and registration fees.