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ratelena [41]
3 years ago
13

Which of the following statements is true about profits in a monopolistically competitive market? A. Most firms will earn substa

ntial profits from year to year.
B.Many firms will earn profit in the short term, but they must constantly innovate and compete to earn profits in the long term.
C.Profits are rare in monopolistically competitive markets.
DMonopolistically competitive firms are as profitable as monopoly firms.
Business
1 answer:
nydimaria [60]3 years ago
7 0
<span>The true statement about profits in a monopolistically competitive market is:

B.Many firms will earn profit in the short term, but they must constantly innovate and compete to earn profits in the long term. 

Examples of monopolistic competition:
1) hotel and restaurant businesses
2) consumer services like hair dressers, spa, etc
3) pubs and bars

</span>
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Tpy6a [65]

The company's external equity comes from those funds raised from public issuance of shares or rights. The cost of external equity is the minimum rate of return which the shareholders supply new funds <span>by </span>purchasing<span> new shares to prevent the decline of the market value of the shares. To compute the cost of external equity, we should use this formula:</span> 

Ke<span> = (DIV 1 / Po) + g</span> 

Ke<span> = cost of external equity</span> 

DIV 1 = dividend to be paid next year 

Po = market price of share 

g = growth rate 

In the problem, the estimated dividend to be paid next year is $1.50. The market price is $18.50 and the growth rate is 4%. 

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8 0
2 years ago
Select best example below illustrative of transaction costs.a. All of the above b. The costs of various dinners during which a c
vaieri [72.5K]

Answer:

The correct option is A

Explanation:

Transaction costs are the whole array of costs associated with selling, buying, transferring goods etc.

Transaction costs can be of different types which are:

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2 years ago
Baruch co. has 8% coupon bonds on the market that have 10 years left to maturity. The bonds will make annual payments. If the YT
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Explanation:

The computation of the current bond price is shown below:

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