All of the Following Are Reasons Why a Firm May

question 43

Multiple Choice

All of the following are reasons why a firm may face capital rationing except:

• A)reluctant to issue additional debt
• B)the discount rate is too high
• C)lacks the managerial resources
• D)restrictive covenants that limit borrowing

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Definitions:

Price Extortion

Price extortion occurs when a seller significantly increases the price of goods or services to a level much higher than is considered reasonable or fair, often in situations where consumers have limited choices or during emergencies.

Dominant Strategy

In game theory, a strategy that is best for a player in a game regardless of the strategies chosen by the other players.

Pricing Strategy

A plan or method implemented by a company to price its products or services to attract consumers while maximizing profit.

Cable TV Market

The sector of the television industry where television services are provided to consumers via coaxial or fiber-optic cables.