A Good Is Said to Have an Elastic Supply If

question 199

Multiple Choice

A good is said to have an elastic supply if its price elasticity of supply is ________.

• A) equal to zero
• B) between zero and one
• C) equal to one
• D) greater than one

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Definitions:

Average Sale Period

This measure indicates the average duration it takes for a company to turn its inventory into sales.

Operating Cycle

The duration of time from the acquisition of inventory to the collection of cash from receivables, reflecting the company's efficiency in using its assets.

Times Interest Earned

A financial ratio that measures a company's ability to cover its interest charges with its earnings before interest and taxes (EBIT).

Debt-To-Equity Ratio

A calculation to determine a firm's financial leverage by dividing the total amount of its liabilities by the equity of its shareholders.