The Notion That the Second Unit of a Good Consumed

question 151

Multiple Choice

The notion that the second unit of a good consumed improves the happiness of the consumer by less than the first unit improved the happiness of the consumer is summarized as

• A)the substitution effect.
• B)the real-balances effect.
• C)diminishing marginal utility.

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Definitions:

Corporate Tax Rate

The tax imposed on the net income of a corporation.

Capital Structure

The mix of a company's long-term debt, specific short-term debt, common equity and preferred equity, determining its financial stability and strategy.

WACC

Weighted Average Cost of Capital; an analysis of a company's capital expenditure costs, weighted proportionally across different capital categories.

Cost of Debt

The cost of debt is the effective rate that a company pays on its borrowed funds, accounting for interest expenses on all debts.