The Greater the Accuracy of a Forecast, the _______Its Value

question 127

Multiple Choice

The greater the accuracy of a forecast, the _______its value as the firm faces a_______ increase in expected profit.

• A)smaller; smaller
• B)greater; larger
• C)greater; smaller
• D)smaller; larger

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Definitions:

Equilibrium

The state in which market supply and demand balance each other, and as a result, prices become stable.

Maximum Utility

The highest level of satisfaction or benefit that a consumer can obtain from the consumption of goods and services within the constraints of their income and prices.

Consumer Income

The total amount of money earned by individuals or households that can be used for saving, spending, or investing.

MU y/ Pᵧ

MU y/ Pᵧ represents the marginal utility of good "y" divided by its price, a concept in economics used to analyze consumer choice, indicating the additional satisfaction per unit of currency spent on that good.