A fiRm Has Inadequate ____________ If It Does Not Have

question 317

Multiple Choice

A firm has inadequate ____________ if it does not have sufficient assets to pledge in the case of default. As a result it will likely be rejected for credit.

• A) Capacity.
• B) Character.
• C) Capital.
• D) Collateral.
• E) economic conditions

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Definitions:

Purely Competitive

Refers to a market structure characterized by a large number of buyers and sellers, where all firms offer identical products and there is free entry and exit.

Profit-maximizing Level

The output level at which a firm achieves the highest possible profit.

Short-run

In economics, a period wherein at least one input (like capital) is fixed, and firms can only adjust variable inputs (like labor).

Normal Profits

The level of profit necessary to keep a firm in a specific industry or market in the long run, equating to the firm’s opportunity costs.