Barry Customizes Harley-Davidson Motorcycles

question 92

Multiple Choice

Barry customizes Harley-Davidson motorcycles.No two cycles are alike.He notices that very few customers even ask the price of his motorcycles before they decide to purchase them.Demand for his motorcycles is probably

• A) price sensitive.
• B) price elastic.
• C) price inelastic.
• D) income elastic.
• E) cross-price elastic.

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Definitions:

Call Premium

The amount by which the call price of a bond or preferred stock exceeds its face value or issue price.

Par Value

The face value of a bond or stock as stated by the issuing company, typically not indicative of market value.

Call Price

The price at which a callable bond or security can be redeemed by the issuer before its maturity.

Negative Covenants

Provisions in a loan agreement that restrict certain actions of the borrower to protect the lender's interests.