Which One of the Following Is Consistent with a Company

question 16

Multiple Choice

Which one of the following is consistent with a company recording a large operating income but having a net cash outflow from operations?

• A)A great amount of depreciation expense
• B)An increase in accounts receivable and inventory
• C)An increase in accounts payable
• D)Acquisition of new plant assets for cash

Apply knowledge of cost functions to calculate optimal output and understand its implications on a firm’s profitability.

Recognize the conditions necessary for long-run equilibrium under perfect competition and the implications for firm entry and exit.

Identify and explain the differences among constant-cost, increasing-cost, and decreasing-cost industries and their impact on market equilibrium.

Understand the effects of taxes and regulations on firm’s production decisions and economic outcomes in the long term.