If There Is a Sole Producer of a Good,and He

question 11

Multiple Choice

If there is a sole producer of a good,and he faces no threat of competition,it is likely that:

• A)government intervention will increase total surplus.
• B)government intervention will decrease consumer and producer surplus.
• C)government intervention will change prices and have no effect on surplus.
• D)government intervention will make things better for everyone.

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Definitions:

Capitalize

The process of recording an expenditure as an asset, rather than an expense, thus spreading the cost over its useful life.

Construction Loan

A short-term loan provided to finance the building of a property or real estate project, with the property itself usually serving as collateral.

Interest-bearing Debt

A type of debt that incurs interest expenses over the loan period.

IFRS Rules

Specific guidelines and standards set out by the International Financial Reporting Standards to govern how financial transactions and positions should be reported in the financial statements.