The Figure Below Shows the Demand and Supply Curves in the Market

question 51

Multiple Choice

The figure below shows the demand and supply curves in the market for elementary education. Figure 13.1
In the figure,
D: Private demand curve for elementary education
D + s: Demand curve which includes public benefits
S: Supply curve of education
Price and Quantity have been taken on vertical and horizontal axes respectively.
Figure 13.1 represents a situation of:

• A)positive externalities.
• B)negative externalities.
• C)excess capacity.
• D)optimal provision of a public goods.
• E)comparative advantage.

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Definitions:

Black-Scholes Model

A mathematical model used for pricing European-style options and assessing the options' market value based on factors such as volatility, risk-free rate, and time to expiration.

Exercised

Refers to the act of implementing the rights granted by a financial contract, commonly in options trading where a buyer may execute the option.

Hedge Ratios

Financial ratios used to calculate the optimal amount of exposure needed to hedge (protect against risk) a position or portfolio.

Long Calls

An option strategy involving the purchase of call options, giving the buyer the right, but not the obligation, to purchase a security at a specified price within a certain time frame.