Generally Speaking, a Firm Is Subject to High Degrees of Operating

question 38

Multiple Choice

Generally speaking, a firm is subject to high degrees of operating exposure when

• A)either its cost or its price is sensitive to exchange rate changes.
• B)both the cost and the price are sensitive to exchange rate changes.
• C)both the cost and the price are insensitive to exchange rate changes.
• D)none of the above

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Definitions:

Natural Resources

Raw materials and components found in the environment that can be used for economic gain, such as minerals, forests, water, and land.

Final Goods and Services

Goods and services sold to final, or end, users.

Entrepreneurial Ability

Entrepreneurial ability involves the skills and qualities that enable an individual to identify opportunities, take risks, and organize resources effectively to start and manage a business.

Sole Proprietorship

A business owned and managed by a single individual, with personal responsibility for all debts and legal actions.