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Questions and Answers
What factor of production can the concept of arbitrage be applied to?
What factor of production can the concept of arbitrage be applied to?
- Land
- Capital (correct)
- Labor
- Entrepreneurship
What does arbitrage involve apart from simple trading opportunities?
What does arbitrage involve apart from simple trading opportunities?
- Risk-free transactions
- Taking advantage of price differences (correct)
- Long-term investments
- Speculative investment
What is an example of arbitrage mentioned in the text?
What is an example of arbitrage mentioned in the text?
- Borrowing cheap capital to invest in a country with expensive capital (correct)
- Buying and selling stocks on the same day
- Trading goods between countries for profit
- Investing in high-risk assets for potential high returns
In what way can a firm use arbitrage in the context of borrowing and investing?
In what way can a firm use arbitrage in the context of borrowing and investing?
Can arbitrage only be applied to trading opportunities?
Can arbitrage only be applied to trading opportunities?
What does arbitrage involve apart from simple trading opportunities?
What does arbitrage involve apart from simple trading opportunities?
In what way can a firm use arbitrage in the context of borrowing and investing?
In what way can a firm use arbitrage in the context of borrowing and investing?
What factor of production can the concept of arbitrage be applied to?
What factor of production can the concept of arbitrage be applied to?
Can arbitrage only be applied to trading opportunities?
Can arbitrage only be applied to trading opportunities?
What is an example of arbitrage mentioned in the text?
What is an example of arbitrage mentioned in the text?
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