A Firm That Considers Price as a Given and Chooses

question 144

Multiple Choice

A firm that considers price as a given and chooses quantity of output accordingly is called a

• A)profit-maximizer.
• B)quantity-setter.
• C)market-taker.
• D)monopoly.
• E)price-taker.

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Definitions:

Reinvested

The act of using dividends, interest, or any form of returns to purchase additional shares or assets rather than taking cash.

Present Value

The current financial evaluation of receiving a sum of money or series of payments in the future, discounted by a pre-determined return rate.

Discount Rate

The interest rate used to discount future cash flows to their present value, often used in capital budgeting.

Future Cash Flows

Projected cash payments or receipts over a future period, crucial for evaluating investments and financial planning.