In What Two Ways Does Trade Benefit Consumers When Firms

question 106

Multiple Choice

In what two ways does trade benefit consumers when firms are monopolistically competitive?

• A) better quality products, increased information
• B) higher incomes, more dependable products
• C) lots of bells and whistles, higher wages
• D) lower prices, more variety

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Definitions:

Bond's Yield

The return an investor realizes on a bond, calculated as the interest or dividends received divided by the price of the bond.

Cost of Capital

The rate of return a company must earn on its investments to maintain its market value and satisfy its shareholders and creditors.

NPV

Net Present Value - a calculation used to assess the profitability of a project or investment by summing the present values of all cash flows associated with it.

IRR

Internal rate of return. A capital budgeting technique that rates projects according to their expected return on invested funds. The higher the return the better.