A Decrease in the Price of a Good Causes

question 61

Multiple Choice

A decrease in the price of a good causes

• A)a change in the slope of the budget line.
• B)a decrease in the consumption of that good.
• C)a leftward shift of the demand curve for that good.
• D)a parallel leftward shift of the budget line.

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Definitions:

Average Operating Assets

An average value of the assets used in the regular operations of a business over a specific period.

Net Operating Income

A measure of a company's profitability, calculated as the difference between its total revenue and operating expenses, excluding taxes and interest.

Return On Investment

A financial ratio used to calculate the profitability of an investment, comparing the gain from an investment relative to its cost.

Residual Income

The income that remains after subtracting from the net operating income the cost of capital charged for utilizing the capital in generating the net operating income.