+1-415-670-9189
info@expertsmind.com
Explain why the presence or lack of profits might exist
Course:- Microeconomics
Reference No.:- EM13700166




Assignment Help
Assignment Help >> Microeconomics

Zelda Industries is the only firm of its kind in the world. Due largely to historical accident, it began producing streganomas in 1985 in a vacant warehouse. Virtually anyone with a degree in college chemistry could easily replicate the firm's formula, which is not patent protected. Nonetheless, since 1985 Zelda has averaged accounting profits of 6 percent on investment. This rate is comparable to the average interest rate that large banks paid on deposits over the period.

a) Do you think Zelda is earning monopoly profits? Why?

b) Explain why the presence or lack of profits might exist.




Put your comment
 
Minimize


Ask Question & Get Answers from Experts
Browse some more (Microeconomics) Materials
Consider a perfectly competitive market where market demand is given by Qd=30-P and market supply is given by Qs=2P. In this market, the government has imposed a production qu
Suppose that a corporate bond with a Baa credit rating and five years to maturity has a yield to maturity of 8 percent. Suppose that the government of the city of Udwellum,
Identify specific examples of prominent computer hardware and software technological advances in the industry. Discuss two of the following points and apply that to your exa
Thomas Malthus’s gloomy predictions for the future of humanity led ‘economies’ to be called a ‘dismal science’. Show either through the mathematics of production functions or
RES 327- Analyze the issue/outcome and socio-economic considerations. Evaluate whether economic history is bound to repeat. You will want to generate hypotheses to account f
Review the resources and research additional sources to determine the bearing of current international financial crises on global economies. Please respond to the followi
But this mo­ tivation is not entirely appropriate, at least for the way we described Gre­ sham's law. Why not? How can you make Greshams law appropriate?
The clinic has hired an efficiency expert to examine its operations and make suggestions for reducing costs.For some of the medical procedures done at the clinic, experienced