A Justification for Patents Is That Without Patents Consumer Surplus

question 60

Multiple Choice

A justification for patents is that without patents consumer surplus would be

• A) larger than with the patent.
• B) zero since the product would not be invented.
• C) only slightly smaller than with the patent.
• D) zero since the monopoly would be a revenue maximizer.

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Definitions:

Specialists

Professionals on a stock exchange who are responsible for maintaining a fair and orderly market in their specific assigned securities.

Margin Account

An account offered by brokerages that allows investors to borrow money to buy securities, with the securities themselves serving as collateral for the loan.

Margin Loan

A loan provided by brokers to investors that allows them to buy securities by borrowing funds, using the purchased securities as collateral.

Maintenance Requirements

The minimum equity amount that must be maintained in a margin account.