What Does a Market Demand Curve Reflect

question 219

Multiple Choice

What does a market demand curve reflect?

• A) how much all buyers are willing and able to buy at each possible price
• B) how quantity demanded changes when the number of buyers changes
• C) the fact that the level of income is inversely related to quantity demanded
• D) when the buyers are willing to buy the most

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Definitions:

Future Cash Flows

Estimates of the amount of money expected to be received or paid out in the future through investment, business operations, or other financial activities.

Investment

The act of allocating resources, typically money, with the expectation of generating an income or profit.

Opportunity Cost of Capital

The return foregone by investing in a project instead of in comparable financial assets with similar risk.

Net Present Value

Net Present Value (NPV) is a financial metric that calculates the present value of all future cash flows (positive and negative) expected from an investment, adjusted for time and interest.