Answer: increase
Explanation:
The supply curves slope upward due to the fact that there's a direct relationship between the price of the good and the quantity that's supplied.
This means that when price increase let's say the price of a good moves from $5 to $7, the suppliers will supply more due to the price increase.
Answer: Government regulation, Economies of scale
Explanation:
Barriers to entry refers to the restrictions that are imposed on the entry of a new firm or business into the market. These can be,
a). <em>Government regulation</em>- Sometimes the government puts many restrictions on the entry of a new firm. These can be license requirement or by limiting the availability of a resource.
b). <em>Economies of scale</em>- These refer to the efficiency in production that occurs when one firm grows larger in size and is able to cover the entire market at a lower cost than many small firms producing the same good in smaller quantities. The cost of production is lower for a single firm than for many firms.
Answer:
(c) Foreign exchange option
Explanation:
Derivatives refer to those securities whose value is derived from the underlying asset. Examples being currency derivatives, commodity derivatives, etc.
Foreign exchange option refers to a derivative instrument whereby the holder has the right but not the obligation to buy or sell a currency at a future date at a predetermined rate fixed today.
In a call option, the holder has the right but not the obligation to buy a currency while in a put option the holder has the right but not the obligation to sell a currency.
The predetermined price at which the holder can buy or sell a currency is referred to as the strike price or exercise price.
