Assume There Are Three Hardware Stores,each Willing to Sell One

question 19

Multiple Choice

Assume there are three hardware stores,each willing to sell one standard model hammer in a given time period.House Depot can offer their hammer for a minimum of $7.Lace Hardware can offer the hammer for a minimum of $10.Bob's Hardware store can offer the hammer at a minimum price of $13. Given the scenario described,if the market price of hammers was $10,then:

• A) only House Depot would gain surplus by supplying hammers to the market.
• B) only House Depot and Lace Hardware would gain surplus by supplying hammers to the market.
• C) House Depot, Lace Hardware, and Bob's Hardware would all supply hammers to the market, but Bob's would lose surplus.
• D) only House Depot and Bob's Hardware would supply hammers to the market.

---

Definitions:

Collateral

An asset pledged as security for repayment of a loan, to be forfeited in the event of default.

Secured Bonds

Bonds that are backed by collateral, providing a safer investment option with lower interest rates due to reduced risk.

Debenture Bonds

Bonds that are unsecured and are issued only on the general credit of a corporation.

Quoted

Refers to the current price of a security, commodity, or currency that is stated in communication or trading.