Which of the Following Economic Characteristics Is Consistent with a Pharmaceutical

question 45

Multiple Choice

Which of the following economic characteristics is consistent with a pharmaceutical company?

• A) Low barriers to entry.
• B) High levels of research and development.
• C) Low profit margins.
• D) Low business risk.

---

Definitions:

Initial Endowment

Refers to the initial amount of money, assets, or resources that an individual, firm, or country possesses before entering into any trading or production activities.

Pareto Optimal

An arrangement of resource distribution that prevents the improvement of one individual's condition without adversely affecting another individual.

Utility Function

A utility function is an economic concept that models an individual's preference ordering over a set of goods or outcomes, representing satisfaction or happiness.

Edgeworth Box

A diagram used in microeconomics to show the distribution of resources or outcomes in a two-person (or two-good) economy, illustrating potential areas of mutual benefit through trade.