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Other things being equal, the effect of a decrease in the price of Coca-Cola would cause which of the following?

  a. A leftward shift in the demand curve for Coca-Cola.  
  b. An upward movement along the demand curve for Coca-Cola.  
  c. A rightward shift in the demand curve for Coca-Cola.  
 

d. A downward movement along the demand curve for Coca-Cola.

 

Which of the following statements is CORRECT?

  a. The use of debt financing will tend to lower the basic earning power ratio, other things are held constant.  
  b. All else equal, increasing the debt ratio will increase the ROA.  
  c. The numerator used in the TIE ratio is earnings before taxes (EBT). EBT is used because interest is paid with post-tax dollars, so the firm's ability to pay current interest is affected by taxes.  
  d. A firm that employs financial leverage will have a higher equity multiplier than an otherwise identical firm that has no debt in its capital structure.  
 

e. If two firms have identical sales, interest rates paid, operating costs, and assets, but differ in the way they are financed, the firm with less debt will generally have the higher expected ROE.
 
 
   

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Chika Ilonah
Chika IlonahLv10
28 Sep 2019

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Related questions

Demand and Supply of Product X (per week)

price quantiy demanded quanity supplies surplus/shortage pressure on price
1 20 0
2 15 5
3 10 10
4 5 15
5 0 20

True or False?

1) The law of demand implies that an increase in the price of good will decrease the demand for that good.

2) The law of supply implies that an increase in the price of a good will increase the quantity supplied of that good.

3) A change in a non-price determinant of demand will result in the movement along a given demand curve.

4) An increase in supply is reflected graphically as a leftward shift of the supply curve.

5) There is no difference between changes in quantity demanded of beef and change in demand for beef. Justify your answer.

6) Because the price of milk was very high, my mother bought less cereal than usual.

7) Now that my uncle Thomas has an increase in income his household consumes less potatoes and cabbages.

8) Because the price of Pepsi cola fell, price of coca cola remaining the same, we bought many cans of coca cola last month.

13. If the price of gasoline increases and car dealers experience a decrease in demand for sport utility vehicles, then gasoline and sport utility vehicles are:

Select one:

a. substitutes.

b. unrelated goods.

c. inferior goods.

d. complements.

14. Specifically, a change in the quantity supplied is referring to:

Select one:

a. A movement along a given supply curve resulting from a change in price

b. A shift in the supply curve either up or down

c. A change in the minimum price sellers are willing to sell for resulting from a change in a determinant of supply (like input prices, technology, or taxes)

d. A shift in the supply curve either left or right

15. Which of the following would be classified as an intermediate good?

Select one:

a. The fabric purchased by a jean manufacturer to make their pants.

b. The wood purchased by a homeowner to build his own deck.

c. The book purchased by a student for their economics class.

d. The bottling machine purchased by Coca Cola to use in one of the bottling plants.

16. The single best indicator of a recession is:

Select one:

a. negative nominal GDP growth.

b. increasing unemployment.

c. falling prices.

d. negative real GDP growth.

17. A leftward shift of a product supply curve might be caused by:

Select one:

a. a decline in the prices of needed inputs.

b. some firms leaving an industry.

c. an improvement in the relevant technique of production.

d. an increase in consumer incomes.

18. The law of supply predicts that when price increases, holding all else constant, the quantity supplied by firms increases.

Select one:

True

False

1)The law of demand states that as the price of a good rise, _____.

A. buyers purchase more of the good because the price of a substitute has risen.

B. buyers purchase less of the good because their real income decreases with an increase in price.

C. buyers purchase more of the good because they expect prices to be even higher in the future

D. buyers purchase less of the good because they expect prices to fall in the future.

 

2) A movement along a demand curve can be attributed to a change in:

A. the quantity demanded of a good.

B. the demand for a good.

C. the substitution effect of consuming a good.

D. the opportunity cost of producing a good.

 

3) If we say that demand for a good has increased, we mean that there has been:

A. a leftward shift of the demand curve.

B. a rightward shift of the demand curve.

C. a leftward movement along the demand curve.

D. a rightward movement along the demand curve.

 

4) Which of the following will cause the demand curve for a normal good to shift to the right?

A. An increase in the price of a complementary good.

B. A decrease in income.

C. A decrease in the price of the good.

D. An increase in the price of a substitute good.

 

5)Which of the following best defines supply?

A. The amount of a good that is produced at the least possible cost, other things constant

B. The amount of a good that producers are willing and able to sell at each possible price, other things constant.

C. The amount of a good that consumers want to buy at different income levels

D. The amount of a good that producers want to sell at a fixed price

 

6)The market supply curve of a particular product indicates the total quantities:

A. that are actually sold during a given time period.

B. that sellers are willing to offer for sale at a fixed price.

C. that buyers are willing to purchase at alternative prices.

D. that sellers are willing and able to offer at alternative prices.

 

7)When quantity demanded of a good exceeds the quantity supplied at the prevailing market price, _____.

A. the demand curve shifts rightward until the surplus is eliminated

B. the market is in equilibrium.

C. the price of the good will tend to increase.

D. the price of the good will decrease

 

8)A shortage of textbooks is most likely to cause:

A. an increase in the price of textbooks.

B. a decrease in the supply of textbooks.

C. a decrease in the price of paper.

D. an increase in the cost of printing.

 

9)The most important characteristic of the equilibrium price is that it:

A. maximizes the quantity demanded.

B. clears the market, leaving neither a surplus nor a shortage.

C. minimizes the quantity demanded.

D. guarantees that producers earn the profit.

 

10)If both demand and supply increases in a market that is initially in equilibrium, the price will:

A. increase only if demand increases more than supply.

B. increase only if supply increases more than demand.

C. remain unchanged while quantity will increase.

D. remain unchanged while quantity will decrease.

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