A profit-maximizing firm in a competitive market is currently producing 100 units of output. It has a price of $10, average tota
1 answer:
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Answer: 5.15%
Explanation:
The Constant Dividend Growth Model is used to calculate the price of a stock given the next dividend that will be paid on it, its required return and its constant growth rate by the formula;
Price =
$92.51 =
9.084482 - 92.51g = 4.32
9.084482 - 4.32 = 92.51g
92.51g = 4.764482
g = 0.0515
g = 5.15%
The correct option is (c) no legal barriers prevent a firm from entering an industry.
No legal barriers:
Non-legal writing non-legal careers anything unrelated to the law or the legal profession.
Because, the industry is free and flexible for enter and exit and no other government interventions will be applicable in that free entry no barriers is there and movability will be for any industry.
Not option (a) Because, the government really levies admission fees for certain types of businesses due to the legal issues surrounding certain businesses and fields, hence they never reimburse the fees.
Not option (b) because, Because it is a government supported program and private businesses cannot participate for free, only semi-government or completely government can do the same, government financed research never helps in sustaining in lower cost patients and hurdles.
Not option (c) because, If a company is operating a successful and reliable business, its marginal cost cannot be zero, and thus will normally not provide free entrance into any industry or type of business.
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