Which of the Following Statements Is false

question 67

Multiple Choice

Which of the following statements is false?

• A) Financial institutions are typically adversely impacted by higher rates of interest.
• B) Industries with high operating leverage typically benefit with inflation when their costs are fixed in nominal terms.
• C) Industries with low financial leverage typically outperform firms with higher leverage when inflation increases.
• D) A weaker U.S. dollar typically helps U.S. industries.
• E) Consumer cyclical industries are affected by increasing interest rates.

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Definitions:

Yield Management

A strategy used in industries with fixed capacities, like airlines or hotels, to maximize revenue through dynamic pricing and inventory control.

Discount Rate

The discount rate applied in the evaluation of discounted cash flow analysis to calculate the current value of future cash flows.

Sold Rooms Percentage

A metric in the hospitality industry that represents the ratio of rooms booked to the total number of available rooms, indicating occupancy rate and hotel performance.

Yield Management

A pricing strategy that aims to maximize revenue by dynamically setting prices based on the supply and demand for a product or service.