Retained earnings may be a better source of funds than issuing stocks or bonds because management does not have to account for their effectiveness this way.
Answer the following statement true (T) or false (F)
True
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A 10 percent increase in income brings about a 15 percent decrease in the demand for a good. What is the income elasticity of demand and is the good a normal good or an inferior good?
What will be an ideal response?
Suppose Thelma and Louise both sell fried green tomatoes in a perfectly competitive market. If Louise increases her output,
a. Thelma must reduce output b. the price Thelma can charge falls c. the price Thelma can charge rises d. the price Thelma can charge is unaffected e. Thelma's profits must fall
Bailey's Barber Shop knows that a 5% increase in the price of their haircuts results in a 15% decrease in the number of haircuts purchased. What is the elasticity of demand facing Bailey's Barber Shop?
a. 0.05 b. 0.10 c. 0.33 d. 3.0
If both the market for a firm's output and the market in which it hires its labor are perfectly competitive, the firm's labor demand curve will be perfectly elastic
a. True b. False