Debt Investments

question 65

Multiple Choice

Debt investments:

• A) Reflect an ownership relationship.
• B) Are cash equivalents.
• C) Are usually accounted for using the amortized cost method.
• D) Are cash equivalents and reflect a creditor relationship.
• E) Can be converted to cash within 3 months or less.

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Definitions:

Inelastic

A description of a good's demand when consumers’ demand for it does not significantly change with a change in the good's price.

Total Revenue

The total income received by a firm from its sales of goods or services, calculated as the quantity sold times the price per unit.

Price Lowered

A decrease in the cost of a good or service to consumers.

Price Elasticity

A measure of the responsiveness of quantity demanded or supplied of a good to a change in its price.