Acquiring a supplier because it becomes more profitable
a. will raise the asking price to offset any increase in cash flow over time
b. will increase your profits
c. will decrease your profits
d. will make you alter operations
a
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Consider an open economy that is a net borrower (like the United States). What would be the impact of a shift to a closed economy?
A) domestic interest rates would decline B) domestic savings would decline C) domestic investment would decline D) net borrowing would increase
Robinson Crusoe is stranded on an island. He finds that coconuts are freely available (zero harvest cost), but fish are difficult to harvest and require a lot of energy. As a result, harvesting fish has a high price
If coconuts and fish are imperfect substitutes, what is Robinson Crusoe likely to consume? A) He will consume more coconuts than fish. B) He will consume more fish than coconuts. C) He will consume equal amounts of both goods. D) Not enough information is given.
A diversified portfolio only makes sense for large institutional investors, not for small investors.
Answer the following statement true (T) or false (F)
The price elasticity of demand measures the responsiveness of:
A. firms to changes in demand. B. demand to a change in price of a substitute good. C. demand to a change in price. D. quantity demanded to a change in price.