An Increase in Investments in Long-Term Securities Will

question 76

Multiple Choice

An increase in investments in long-term securities will

• A)increase cash flow from investing activities.
• B)decrease cash flow from investing activities.
• C)increase cash flow from financing activities.
• D)decrease cash flow from financing activities.

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Definitions:

Perfectly Competitive Firm

A perfectly competitive firm operates in a market where there are many buyers and sellers, the product is homogenous, and there is free entry and exit from the market.

Economic Profit

The gap in financial terms between total earnings and all financial burdens, considering both express and tacit costs.

Short Run

A period of time during which at least one of a firm's inputs is fixed, limiting the firm's ability to adjust to changes in demand or production costs.

Perfectly Competitive Firm

A firm operating in a market where there are many buyers and sellers, with none being able to influence the market price of the product.