Which of the Following Statements Is Most Correct

question 9

Multiple Choice

Which of the following statements is most correct?

• A) If credit sales as a percentage of a firm's total sales increases, and the volume of credit sales also increases, then the firm's accounts receivable will automatically increase.
• B) It is possible for a firm to overstate profits by offering very lenient credit terms which encourage additional sales to financially "weak" firms. A major disadvantage of such a policy is that it is likely to increase uncollectible accounts.
• C) A firm with excess production capacity and relatively low variable costs would not be inclined to extend more liberal credit terms to its customers than a firm with similar costs that is operating close to capacity.
• D) Firms use seasonal dating primarily to decrease their DSO.
• E) Seasonal dating with terms 2/15, net 30 days, with April 1 dating, means that if the original sale took place on February 1st, the customer can take the discount up until March 15th, but must pay the net invoice amount by April 1st.

Understand the concept of consumer surplus in the context of product pricing.

Recognize examples of "metering" strategy in various industries.

Evaluate the legal considerations in volume discounts through the lens of the Robinson-Patman act.

Grasp the differentiation between individual and aggregate demand.

---

Definitions:

AUG

A codon that both signals the start of translation and codes for the amino acid methionine in genetic sequences.

Single Gene

A gene that by itself can determine a particular trait or phenotype.

Multiple Versions

Different editions or forms of the same content or object, often existing to suit different needs or preferences.

Protein

Large, complex molecules made up of amino acids that play many critical roles in the body, including in the structure, function, and regulation of tissues and organs.