Speculative Companies Are Firms Where

question 5

Multiple Choice

Speculative companies are firms where

• A) Sales, earnings and cash flows are extremely uncertain and not necessarily related to the economy.
• B) Sales, earnings and cash flows are likely to withstand changes caused by the economic environment.
• C) Sales, earnings and cash flows are heavily influenced by aggregate business activity.
• D) Sales, earnings and cash flows are growing exponentially.
• E) None of the above.

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Definitions:

Tickets

Documents or electronic codes that grant the holder the right to enter an event, travel on a vehicle, or participate in an activity.

Economic Profits

Profits exceeding the opportunity costs of all resources used in production, including the cost of capital.

Marginal Analysis

The examination of the benefits and costs of choosing one more or one less unit of a good or service.

Implicit Costs

The opportunity costs of using resources owned by the firm for its own production instead of selling or renting them to others.