Which of the Following Statements Is Not True

question 91

Multiple Choice

Which of the following statements is not true?

• A)The way to increase the profitability of a firm is to create more value.
• B)The amount of value a firm creates is measured by the difference between its costs of production and the value that consumers perceive in its products.
• C)The more value customers place on a firm's products,the higher the price the firm is able to charge for those products.
• D)The price a firm charges for a good or service is typically more than the value the customer places on that good or service.

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Definitions:

Nominal Rate

The nominal rate is the interest rate stated on a loan or investment agreement, not accounting for inflation or other factors that affect the real rate of return.

Compound Annual Rate

The rate at which an investment grows annually when interest is reinvested to earn additional interest.

Nominal Rate

The interest rate before adjustments for inflation or other factors, often referred to as the stated or face interest rate.

Compounded Quarterly

A method of calculating interest where the accrued interest is added to the principal sum every quarter, thus increasing the base for the next interest calculation.