Assume Consumer Demand for CD-ROMs Increases

question 79

Multiple Choice

Assume consumer demand for CD-ROMs increases. The result is a(n) :

• A) increase in derived demand for workers in the CD-ROM industry.
• B) increase in the marginal revenue product of firms in the CD-ROM industry.
• C) rightward shift in the market demand for labor curve in the CD-ROM industry.
• D) all of the above.
• E) none of the above.

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Definitions:

Incremental Borrowing Rate

The interest rate a lessee would have to pay if borrowing over a similar term, and with similar security, the funds necessary to lease or purchase an asset.

Lessor's Implicit Rate

The interest rate used in lease agreements, assumed by the lessor, that when applied to the lease payments, equals the fair value of the leased asset.

Ordinary Annuity

A series of equal payments made at the end of consecutive periods over a fixed length of time, such as monthly rent or annual scholarship allowances.

Present Value Factors

Multipliers used to calculate the present value of a sum to be received in the future by accounting for time value of money.