With a Fixed Level of Farm Production, a Given Shift

question 103

Multiple Choice

With a fixed level of farm production, a given shift in demand for a crop will cause a

• A)small price change if demand is quite inelastic.
• B)more dramatic price change if demand is quite elastic.
• C)more dramatic price change if demand is quite inelastic.
• D)similar amount of price change regardless of whether demand is elastic or not.

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Definitions:

Net Income

The total profit of a company after all expenses and taxes have been subtracted from revenue.

Outstanding Shares

The total number of shares of a corporation's stock that are currently owned by all its shareholders, including share blocks held by institutional investors and restricted shares.

Stock Repurchase

An action taken by a corporation to repurchase its own shares from the market, thereby decreasing the total number of shares available.

Residual Dividend Policy

A financial strategy where dividends paid to shareholders are based on the earnings left after all operational and capital expenses, as well as growth investments, have been covered.