The Barrier to Entry That Allowed Alcoa to Make Persistent

question 242

True/False

The barrier to entry that allowed Alcoa to make persistent economic profits was ownership of an essential input.

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Definitions:

Spot Rates

The current market price at which a particular asset can be bought or sold for immediate delivery and payment.

Fair Value Hedge

A type of hedge that protects against changes in the fair value of an asset, liability, or an unrecognized firm commitment, often due to changes in interest rates or other market variables.

Forward Contract

A financial derivative that represents a customized agreement to buy or sell an asset at a predetermined future date and price.

Spot Rate

The current market price for exchanging one currency for another for immediate delivery.