Which One of the Following Have NOT Led to a Closer

question 11

Multiple Choice

Which one of the following have NOT led to a closer relationship between interest rates in national and Eurocurrency money markets?

• A)tax treaties that reduce the incidence of double taxation on foreign?source income
• B)elimination of currency controls
• C)reduced cost of transatlantic telecommunications
• D)increased government regulation of U.S.interest rates

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Definitions:

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale as fixed costs are spread out over more units of output.

Natural Monopoly

A monopoly that exists when increasing returns to scale provide a large cost advantage to having all output produced by a single firm.

Network Externalities

The effect that an additional user of a good or service has on the value of that product to others, often positive, as in the case of telecommunications networks.

Monopolist

A monopolist is a single supplier in a market who has significant control over prices and the availability of a product or service.