What are the Four Types of Economic Utility?

July 7, 2024 No Comments

A: The four types of economic utility are form, time, place and possession. “Utility” in this context refers to the value, or usefulness, that a purchaser receives in return for exchanging his money for a company’s goods or services. Companies seek to provide maximum customer

What are the implications of a low federal funds rate?

July 7, 2024 No Comments

A: The federal funds rate is the short-term interest rate at which banks can borrow money from one another. A low federal funds rate implies expansionary monetary policy by a government; a low interest rate environment for businesses and consumers; and relatively high inflation. Low

What are the key factors that cause the market to go up and down?

July 7, 2024 No Comments

A: It is difficult to identify specific factors that influence the market as a whole. The stock market is a complex, interrelated system of large and small investors making uncoordinated decisions about a huge variety of investments. “The market,” so to speak, is not a

What are the legal barriers to vertical integration?

July 7, 2024 No Comments

A: Vertical integration through internal expansion is not vulnerable to legal challenges. However, if the vertical integration is achieved through a merger, it may, from the outset, be vulnerable to a challenge under the confines of antitrust laws. Vertical integration through a merger is subject

What are the listing requirements for the Nasdaq?

July 7, 2024 No Comments

A: Major stock exchanges, like the Nasdaq, are exclusive clubs—their reputations rest on the companies they trade. As such, the Nasdaq won’t allow just any company to be traded on its exchange. Only companies with a solid history and top-notch management behind them are considered.

What are the main arguments in favor of the privatization of public goods?

July 7, 2024 No Comments

A: Public goods are defined by two characteristics. One is non-excludability, which means that even those who don’t pay for the goods are able to use them. The other is non-rivalry, which means that one person’s use of a good doesn’t reduce its availability to

What are the main differences between a mixed economic system and pure capitalism?

July 7, 2024 No Comments

A: A mixed economy is one in which the government does not own all of the means of production, but government interests may legally circumvent, replace, limit or otherwise regulate private economic interests. By contrast, a free private economic system allows voluntary and competing private

What are the main problems with a JIT (just in time) production strategy?

July 7, 2024 No Comments

A: The benefits of the just-in-time (JIT) production strategy are well-documented, but it can also have some serious disadvantages. The chief issue with this production process is evidenced in its name. “Just in time” means that the success of this business strategy depends largely on

What Are the Major Differences Between a Monopoly and an Oligopoly?

July 7, 2024 No Comments

A: A monopoly and an oligopoly are economic market structures where there is imperfect competition in the market. A monopoly market contains a single firm that produces goods with no close substitute, with significant barriers to entry of other firms. An oligopoly market has a

What are the differences between the Federal Funds Rate and LIBOR?

July 7, 2024 No Comments

A: In macroeconomics, the interest rate plays a crucial role in delivering an equilibrium on the assets market by equating the demand and supply of funds. The two most prominent interest rates widely featured are the federal funds rate and the London Interbank Offered Rate

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