Author Question: When free entry is one of the attributes of a market structure, economic profits are: a. generally ... (Read 72 times)

joesmith1212 · **on:** Jun 30, 2018

When free entry is one of the attributes of a market structure, economic profits are:
a. generally driven to zero in long-run equilibrium.
b. generally negative for all firms.
c. generally zero in the short run.
d. always positive.

Question 2

Assume a U.S. investor buys a Mexican bond with a face value of MXP 1,000 and a 20 percent annual interest yield while the exchange rate is MXP 10 per dollar. What is the dollar return from the bond if the exchange rate at the end of the year is MXP 11 per dollar?
a. 9.1
b. 10.0
c. 18.2
d. 20.0
e. 32.0