MGMT 10 Chapter 19-20: MGMT 10 Chapter 19-2: MGMT 10 Chapter 19-: Ch. 19 & 20

Which one of the following bonds is the most sensitive to changes in market interest rates?

A. Zero-coupon, 25 year

B. 10% annual coupon, 3 year

C. Zero-coupon, 15 year

D. 5% annual coupon, 10 year

5) The price of coffee beans rises on the international market by 5%. Because of its higher raw material costs, The Highland Creek Coffee Shop ( a local coffe shop located about a mile from UTSC) raises the price of its regular sized coffee by 5%. The Mom and Pop Coffee Shop at the corner of Kingston Road and Morningside also raises its prices by 5.% Ed's Shed, a coffee shop on Ellesmere, raises its prices by 4%. At the same time, Starbucks raises the price of its coffee at all 400+ of its Canadian locations by 10%. This kind of pricing decisions would suggest that the market for coffee in Eastern Toronto, and the GTA is: a) b) c) perfectly competitive a monopoly an oligopoly monopolistic competition d)

8) Mario's Pizzeria sells only two kind of pizza: plain and all-dressed. Last year, Mario's Pizzeria sold 2,000 all-dressed pizzas, selling them for $10 each. Mario's sold 10,000 plain pizzas at $5 each. The cost of the ingredients, the box, and all of the electricity and utilities to make the pizzas came to $20,000. In addition, Mario paid $10,000 rent for the store. Finally, Mario paid a total of $10,000 to a couple of students who worked part time, helping out on busy Friday and Saturday nights. Mario paid himself no salary, but took home all of the profits. Last year, Mario made a profit of a) b) c) d) $40,000 $30,000 $60,000 loss of $10,000