Imposing a Restrictive Quota on Imported Plasma TVs Will

question 85

Multiple Choice

Imposing a restrictive quota on imported plasma TVs will:

• A) increase the price of the plasma TVs and decrease the quantity consumed.
• B) increase both the price of the plasma TVs and the quantity consumed.
• C) leave the price of the plasma TVs unchanged but decrease the quantity consumed.
• D) leave the price and the quantity consumed of plasma TVs unchanged, because domestic producers will expand production to make up for the reduction in imports

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Definitions:

Capital Budgeting Decision

The process of deciding which long-term investments should be undertaken by a business.

Debt

A quantity of money that one party lends to another, with the expectation that it will be repaid in the future, often along with interest.

New Store

The establishment of a retail location that hasn't previously existed, indicating business expansion or entry into new markets.

Inventory

Raw materials, work-in-process products, and finished goods that are considered to be the portion of a business's assets that are ready or will be ready for sale.