The Gap Between the Higher Equilibrium Tuition and Lower Student

question 8

Multiple Choice

The gap between the higher equilibrium tuition and lower student tuition is $4,000 at university A and $10,000 at university B. It follows that

• A) if the supply of openings at each university is the same, then the demand to attend university B is higher than the demand to attend university A.
• B) the supply of openings is necessarily larger at university A than B.
• C) instructors at university B are likely to be more punctual when meeting their office hours than instructors at university A.
• D) a and c
• E) none of the above

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Definitions:

Accounts Receivable

Money owed to a company by its customers for goods or services provided on credit.

Financing Activities

Transactions and events that affect long-term liabilities and equity of an entity, reflected in the cash flow statement.

Treasury Stock

Represents shares that were previously issued but have been bought back by the company and are held in its treasury.

Dividends Paid

The portion of a company's earnings distributed to shareholders, usually in the form of cash or additional shares.