Other Things Equal, a Firm That Must Obtain Its Long-Term

question 72

Multiple Choice

Other things equal, a firm that must obtain its long-term debt and equity in a highly illiquid domestic securities market will probably have a:

• A) relatively low cost of capital.
• B) relatively high cost of capital.
• C) relatively average cost of capital.
• D) cost of capital that we cannot estimate from this question.

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Definitions:

Fixed-Interval

A schedule of reinforcement where rewards are provided after a specific and constant period of time has passed.

Variable-Interval

A reinforcement schedule where a reward is given after a random period has elapsed following a response.

Fixed-Ratio

A schedule of reinforcement where a response is rewarded only after a specified number of responses, in behaviorist psychology.

Variable-Ratio

A schedule of reinforcement where a response is reinforced after an unpredictable number of responses, making it highly effective in maintaining behavior after it has been learned.