{"id":124480,"date":"2022-01-27T16:12:30","date_gmt":"2022-01-27T16:12:30","guid":{"rendered":"https:\/\/essayparlour.com\/custom-essays\/?p=124480"},"modified":"2022-01-27T16:12:30","modified_gmt":"2022-01-27T16:12:30","slug":"lets-use-the-arbitrage-equation-to-determine-the-price-of","status":"publish","type":"post","link":"https:\/\/essayparlour.com\/custom-essays\/business-economics-2\/lets-use-the-arbitrage-equation-to-determine-the-price-of\/","title":{"rendered":"Let\u2019s use the arbitrage equation to determine the price of"},"content":{"rendered":"<table style = 'table-striped table-bordered table-hover' responsive='true'>\n<tr>\n<th>Question<\/th>\n<\/tr>\n<tr>\n<td>Let\u2019s use the arbitrage equation to determine the price of a patent in a simple setting. Let R denote the interest rate, let pi denote the price of an \u201cidea\u201d that is under patent, and let Prof denote the extra profit that can be earned by a firm that owns this idea.<br \/>\n (a) Set up the basic arbitrage equation that will ultimately pin down the value of the patent. On the left side show the return from investing pi dollars in a saving account. On the right, show the return from using these funds to purchase the patent.<br \/>\n (b) Solve this equation for the price of the idea.<br \/>\n (c) What is the economic interpretation of this result?<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"<p>Question<\/p>\n<p>\nLet\u2019s use the arbitrage equation to determine the price of a patent in a simple setting. Let R denote the interest rate, let pi denote the price of an \u201cidea\u201d that is under patent, and let Prof denote the extra <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[43],"tags":[],"class_list":["post-124480","post","type-post","status-publish","format-standard","hentry","category-business-economics-2"],"_links":{"self":[{"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/posts\/124480","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/comments?post=124480"}],"version-history":[{"count":1,"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/posts\/124480\/revisions"}],"predecessor-version":[{"id":124481,"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/posts\/124480\/revisions\/124481"}],"wp:attachment":[{"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/media?parent=124480"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/categories?post=124480"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/essayparlour.com\/custom-essays\/wp-json\/wp\/v2\/tags?post=124480"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}