Suppose Biochemists Discover an Enzyme That Can Double the Amount

question 79

Multiple Choice

Suppose biochemists discover an enzyme that can double the amount of ethanol that may be derived from a given amount of biomass. Based on this technological development, we expect the:

• A) supply curve for ethanol to shift leftward.
• B) supply curve for ethanol to shift rightward.
• C) demand curve for ethanol to shift leftward.
• D) demand curve for ethanol to shift rightward.

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Definitions:

Flotation Costs

Expenses incurred by a company in issuing new securities, including underwriting, legal, and registration fees.

Dividends Low

This term implies a situation where a company issues dividends at a lower rate or amount, possibly reflecting a strategy to reinvest earnings into the business or an indication of financial conservation.

Information Content Effect

The impact of news or information release on the financial markets, especially regarding the price of securities.

Share Price

The price of a single share of a company's stock, reflecting the market's value of the company at a given moment.