Many Economists Maintain That

question 96

Multiple Choice

Many economists maintain that

• A)the aggregate supply curve is nearly horizontal at low levels of real GDP.
• B)the aggregate supply curve is nearly vertical at very high levels of real GDP.
• C)any change in aggregate demand will have most of its effect on output when economic activity is low but on prices when the economy is near full employment.
• D)All of these responses are correct.

Analyze the relationship between sales growth, capacity utilization, dividend policy, and the need for additional financing.

Calculate the pro forma financial figures given a set growth rate and specific financial ratios.

Understand the dynamics of cost, asset, and liability management in response to sales changes.

Analyze the effect of dividend payout policies on retained earnings and need for external financing.

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Definitions:

Consolidated Receivables

The aggregation of all receivables or money owed by customers to a company, combined from all its divisions or subsidiaries for reporting purposes.

Par Value

The nominal or face value of a stock or bond, typically used as an accounting standard rather than reflecting market value.

Fair Value

The price achievable in the sale of an asset or required to settle a liability in a seamless transaction with market participants at the date set for evaluation.

Common Stock

A form of corporate equity ownership, representing a claim on a portion of the company's profits and a right to vote on major company decisions.