Essay
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.Do you think Zelda is earning monopoly profits?
Why?
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No.In fact,Zelda could have invested fun...View Answer
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Correct Answer:
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