# on 04-Oct-2017 (Wed)

#### Flashcard 1431688842508

Tags
#cfa #cfa-level-1 #economics #has-images #microeconomics #reading-14-demand-and-supply-analysis-consumer-demand #section-3-utility-theory #study-session-4-microeconomics-analysis

Question
What is this and what are the lines?
An indifference curve map and indifference curves

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#### Flashcard 1438922444044

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#cfa #cfa-level-1 #economic-and-normal-profit #economics #microeconomics #reading-15-demand-and-supply-analysis-the-firm #section-2-objectives-of-the-firm #study-session-4
Question

Economic profit for a firm can originate from sources such as:

• preferential [...] policy;

treatment under governmental

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difficult to copy technology or innovation (e.g., patents, trademarks, and copyrights); exclusive access to less-expensive inputs; fixed supply of an output, commodity, or resource; preferential <span>treatment under governmental policy; large increases in demand where supply is unable to respond fully over time; exertion of monopoly power (price control) in the market; and

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2. OBJECTIVES OF THE FIRM

#### Flashcard 1440324128012

Tags
#cfa-level-1 #factors-that-determine-market-structures #microeconomics #reading-16-the-firm-and-market-structures #section-2-analysis-of-mkt-structures #study-session-4
Question
In which market structures are firms price takers?
perfect competition.

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d on aggregate supply and demand conditions, the individual firm has no control over pricing. The typical hog farmer in Nebraska and the milk producer in Bavaria are price takers . That is, they must accept whatever price the market dictates. <span>This is the case under the market structure of perfect competition. In the case of monopolistic competition, the success of product differentiation determines the degree with which the firm can influence price. In the case of oligopoly, there are so few

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2. ANALYSIS OF MARKET STRUCTURES
d monopoly is the local electrical power provider. In most cases, the monopoly power provider is allowed to earn a normal return on its investment and prices are set by the regulatory authority to allow that return. <span>2.2. Factors That Determine Market Structure Five factors determine market structure: The number and relative size of firms supplying the product; The degree of product differentiation; The power of the seller over pricing decisions; The relative strength of the barriers to market entry and exit; and The degree of non-price competition. The number and relative size of firms in a market influence market structure. If there are many firms, the degree of competition increases. With fewer firms supplying a good or service, consumers are limited in their market choices. One extreme case is the monopoly market structure, with only one firm supplying a unique good or service. Another extreme is perfect competition, with many firms supplying a similar product. Finally, an example of relative size is the automobile industry, in which a small number of large international producers (e.g., Ford and Toyota) are the leaders in the global market, and a number of small companies either have market power because they are niche players (e.g., Ferrari) or have little market power because of their narrow range of models or limited geographical presence (e.g., Škoda). In the case of monopolistic competition, there are many firms providing products to the market, as with perfect competition. However, one firm’s product is differentiated in some way that makes it appear better than similar products from other firms. If a firm is successful in differentiating its product, the differentiation will provide pricing leverage. The more dissimilar the product appears, the more the market will resemble the monopoly market structure. A firm can differentiate its product through aggressive advertising campaigns; frequent styling changes; the linking of its product with other, complementary products; or a host of other methods. When the market dictates the price based on aggregate supply and demand conditions, the individual firm has no control over pricing. The typical hog farmer in Nebraska and the milk producer in Bavaria are price takers . That is, they must accept whatever price the market dictates. This is the case under the market structure of perfect competition. In the case of monopolistic competition, the success of product differentiation determines the degree with which the firm can influence price. In the case of oligopoly, there are so few firms in the market that price control becomes possible. However, the small number of firms in an oligopoly market invites complex pricing strategies. Collusion, price leadership by dominant firms, and other pricing strategies can result. The degree to which one market structure can evolve into another and the difference between potential short-run outcomes and long-run equilibrium conditions depend on the strength of the barriers to entry and the possibility that firms fail to recoup their original costs or lose money for an extended period of time and are therefore forced to exit the market. Barriers to entry can result from very large capital investment requirements, as in the case of petroleum refining. Barriers may also result from patents, as in the case of some electronic products and drug formulas. Another entry consideration is the possibility of high exit costs. For example, plants that are specific to a special line of products, such as aluminum smelting plants, are non-redeployable, and exit costs would be high without a liquid market for the firm’s assets. High exit costs deter entry and are therefore also considered barriers to entry. In the case of farming, the barriers to entry are low. Production of corn, soybeans, wheat, tomatoes, and other produce is an easy process to replicate; therefore, those are highly competitive markets. Non-price competition dominates those market structures where product differentiation is critical. Therefore, monopolistic competition relies on competitive strategies that may not include pricing changes. An example of non-price competition is product differentiation through marketing. In other circumstances, non-price competition may occur because the few firms in the market feel dependent on each other. Each firm fears retaliatory price changes that would reduce total revenue for all of the firms in the market. Because oligopoly industries have so few firms, each firm feels dependent on the pricing strategies of the others. Therefore, non-price competition becomes a dominant strategy. Exhibit 1. Characteristics of Market Structure Market Structure Number of Sellers Degree of Product Differentiation Barriers to Entry Pricing Power of Firm Non-price Competition Perfect competition Many Homogeneous/ Standardized Very Low None None Monopolistic competition Many Differentiated Low Some Advertising and Product Differentiation Oligopoly Few Homogeneous/ Standardized High Some or Considerable Advertising and Product Differentiation Monopoly One Unique Product Very High Considerable Advertising From the perspective of the owners of the firm, the most desirable market structure is that with the most control over price, because this control can lead to large profits. Monopoly and oligopoly markets offer the greatest potential control over price; monopolistic competition offers less control. Firms operating under perfectly competitive market conditions have no control over price. From the consumers’ perspective, the most desirable market structure is that with the greatest degree of competition, because prices are generally lower. Thus, consumers would prefer as many goods and services as possible to be offered in competitive markets. As often happens in economics, there is a trade-off. While perfect competition gives the largest quantity of a good at the lowest price, other market forms may spur more innovation. Specifically, there may be high costs in researching a new product, and firms will incur such costs only if they expect to earn an attractive return on their research investment. This is the case often made for medical innovations, for example—the cost of clinical trials and experiments to create new medicines would bankrupt perfectly competitive firms but may be acceptable in an oligopoly market structure. Therefore, consumers can benefit from less-than-perfectly-competitive markets. PORTER’S FIVE FORCES AND MARKET STRUCTURE A financial analyst aiming to establish market conditions and consequent profitability of incumbent firms should start with the questions framed by Exhibit 1: How many sellers are there? Is the product differentiated? and so on. Moreover, in the case of monopolies and quasi monopolies, the analyst should evaluate the legislative and regulatory framework: Can the company set prices freely, or are there governmental controls? Finally, the analyst should consider the threat of competition from potential entrants. This analysis is often summarized by students of corporate strategy as “Porter’s five forces,” named after Harvard Business School professor Michael E. Porter. His book, Competitive Strategy, presented a systematic analysis of the practice of market strategy. Porter (2008) identified the five forces as: Threat of entry; Power of suppliers; Power of buyers (customers); Threat of substitutes; and Rivalry among existing competitors. It is easy to note the parallels between four of these five forces and the columns in Exhibit 1. The only “orphan” is the power of suppliers, which is not at the core of the theoretical economic analysis of competition, but which has substantial weight in the practical analysis of competition and profitability. Some stock analysts (e.g., Dorsey 2004) use the term “economic moat” to suggest that there are factors protecting the profitability of a firm that are similar to the moats (ditches full of water) that used to protect some medieval castles. A deep moat means that there is little or no threat of entry by invaders, i.e. competitors. It also means that customers are locked in because of high switching costs. <span><body><html>

#### Flashcard 1442599275788

Tags
#gramatica-española #morfología #tulio
Question
sucinto
breve

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LA MORFOLOGÍA
palabras. En este capítulo nos ocuparemos de definir: A. ¿Qué se entiende por "estructura interna de la palabra"? B. ¿Qué clase de unidad es la palabra? Nuestro tratamiento de la morfología será sumamente <span>sucinto: apuntará fundamentalmente a las cuestiones que tienen una particular relevancia para la sintaxis. <span><body><html>

#### Flashcard 1464599448844

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#48-laws-of-power #interpretation #law-2-never-trust-friends-learn-how-to-use-enemies #observance-of-the-law
Question
A Chinese proverb compares friends to the jaws and teeth of a dangerous animal: If you are not careful, [...]
you will find them chewing you up

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A Chinese proverb compares friends to the jaws and teeth of a dangerous animal: If you are not careful, you will find them chewing you up

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#### Flashcard 1622682242316

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#tvm
Question

PV = FVN (1+rs/m)−mn

m = [...]

rs = [...]

N = [...]

number of compounding periods per year

quoted annual interest rate

number of years

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#### Annotation 1674972630284

 In this ultimate metapoetic exchange, the three Abbasid era contenders are aware of their roles as composers of poems and as commentators on that very act at the same time. They address not only each other, but also an assumed audience to whom the Arabic literary tradition is readily available as a backdrop against which the Abbasid q~idah reverberates before it springs forth. And this is metapoesis; a poet's creative response to poetic heritage. It is a state in which a poet is aware of himself as a participant in a project for poetic change but is constantly looking over his shoulder to see how his predeces- sors have done things, to signal references; references against which his rebellion and his contributions become more obvious and meaningful.

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#### Annotation 1678265945356

 His adversary, al-Farazdaq, also used obscenity as a lampooning tool. He is crying on the dungheaps of the abandoned campsites, while his mother, on the tips of the slaves' penises, is going up and down.

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#### Annotation 1699903573260

 os responsáveis pelas estatísticas de finanças públicas, os analistas, a mídia, os consultores financeiros, os grupos de interesse público ou privado podem entender que a informação fornecida pelos RCPGs [Relatórios Contábeis de Propósito Geral] é útil para os seus propósitos.

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#### Flashcard 1699905146124

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Question
os responsáveis pelas estatísticas de finanças públicas, os analistas, a mídia, os consultores financeiros, os grupos de interesse público ou privado podem entender que a informação fornecida pelos [sigla] [ [por extenso] ] é útil para os seus propósitos.
RCPGs
Relatórios Contábeis de Propósito Geral

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os responsáveis pelas estatísticas de finanças públicas, os analistas, a mídia, os consultores financeiros, os grupos de interesse público ou privado podem entender que a informação fornecida pelos RCPGs [Relatórios Contábeis de Propósito Geral] é útil para os seus propósitos.

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#### Flashcard 1699909864716

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Question
O que é a liquidez da entidade?
É a capacidade de satisfazer as obrigações atuais

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