Scenario 9.2 Consider a Publicly Held Firm (One Whose Stock Shares Are

question 112

Multiple Choice

Scenario 9.2
Consider a publicly held firm (one whose stock shares are traded on the stock exchange) that earned revenue worth $350 million and incurred land, labor, and debt costs worth $320 million. The stockholders who have invested a total of $100 million in this firm could have earned 10 percent return on other comparable investments.
-One assumption of the model of perfect competition is that entry into the market is easy. This implies that:

• A)there are government licensing requirements for a firm to enter the market.
• B)there are no significant economies of scale relative to the size of the market.
• C)one firm has gained a patent in the industry.
• D)significant economies of scale do exist in the industry.
• E)there is no government intervention.

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Definitions:

Arthropods

A large group of invertebrate animals that includes insects, spiders, crustaceans, and others, characterized by segmented bodies, exoskeletons, and jointed limbs.

Crustaceans

A diverse group of arthropods, including crabs, lobsters, and shrimp, typically having a segmented body and an exoskeleton.

Vectors

Entities that carry and transmit genetic information or physical quantities, characterized by magnitude and direction.

Diseases

Abnormal conditions that negatively impact the structure or function of part or all of an organism, not directly resulting from physical injury.