A Miami Restaurant Has Created Atmosphere Through Its Subtle Use

question 140

Multiple Choice

A Miami restaurant has created atmosphere through its subtle use of blue and green lighting, ceiling fans over each table, and frozen drinks. If its electrical energy supplier raises its prices, the restaurant will most likely ________.

• A) continue its present operation because it has an elastic demand for electricity
• B) ask other Miami restaurants to create a derived demand for cheaper electricity
• C) decide to find other ways to use electricity
• D) continue its present operation because it has an inelastic demand for electricity
• E) remove its lighting, turn off its fans, and economize on its use of electricity

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Definitions:

Sales

The activities involved in selling products or services, or the total amount of goods or services sold.

Times-Interest-Earned Ratio

A fiscal indicator that evaluates a firm's capacity to satisfy its debt commitments utilizing its present income.

Operating Costs

Expenditures that are necessary for the day-to-day operations of a business, including costs related to manufacturing, sales, and administration.

Interest Charges

Interest charges are the costs incurred by an entity for borrowing money, quantified as a percentage of the principal loan amount.