A Market Demand Curve Is Likely to Shift to the Right

question 44

Multiple Choice

A market demand curve is likely to shift to the right when:

• A) average income falls.
• B) prices fall.
• C) prices rise.
• D) population increases.
• E) new firms enter the market.

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Definitions:

Terminal Growth Rate

The rate at which a company is expected to grow its dividends or free cash flow beyond the forecast period, into perpetuity, during valuation.

Multi Stage Growth Model

A valuation method that applies different rates of growth to a company's earnings or dividends over various time horizons.

Discount Rate

The interest rate used to determine the present value of future cash flows.

FCFF

Free Cash Flow to the Firm is a financial performance measure that estimates the cash available to all funding sources, both equity and debt holders, after accounting for necessary expenses and investments.