In the Context of a Firm's Statement of Cash Flows

question 29

Multiple Choice

In the context of a firm's statement of cash flows, ________ include cash raised during the period by borrowing money or selling stock an/or cash used during the period by paying dividends, buying back outstanding stock, or buying back outstanding bonds.

• A) investing activities
• B) financing activities
• C) operating activities
• D) liquidity activities
• E) capital activities

---

Definitions:

Economic Profits

The total revenue of a business minus its explicit and implicit costs; a measure of incremental gain over the total costs, including opportunity costs.

Supply Curve

A graph showing the relationship between the price of a good and the quantity supplied by producers.

Long-run Equilibrium

A state in which all factors of production and outputs are variable, allowing for the adjustment of all inputs, leading to a balanced economic condition over time.

Zero Economic Profits

Occurs when a firm earns just enough revenue to cover its total costs, including opportunity costs, but no more.