A Business Wire Report Shows That Sales at Target Stores

question 331

Multiple Choice

A Business Wire report shows that sales at Target stores increased in 2012 compared to the previous year. (Source: Business Wire, August 30, 2012) Incomes grew slightly between 2011 and 2012. Using that fact and the sales data given above means that Target definitely is selling goods and services that

• A) are normal.
• B) are inferior.
• C) have an income elasticity of zero.
• D) have an income elasticity of 1.

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Definitions:

Maturity Dates

Refers to the specific date on which the principal amount of a bond, loan, or other financial instrument is scheduled to be paid in full.

Options

Financial derivatives that give the holder the right, but not the obligation, to buy or sell an asset at a pre-determined price before or at a specific time.

ESOs

Employee Stock Options, which are a form of equity compensation granted by companies to their employees as part of their remuneration package.

Guarantee

An assurance or formal promise that specific conditions will be fulfilled, often related to the quality, durability, or functionality of a product or service.