In the Following Question You Are Asked to Determine,other Things

question 166

Multiple Choice

In the following question you are asked to determine,other things equal,the effects of a given change in a determinant of demand or supply for product X upon (1) the demand (D) for,or supply (S) of,X; (2) the equilibrium price (P) of X;and (3) the equilibrium quantity (Q) of X. Refer to the given information.An increase in the price of a product that is a complement to X will:

• A) decrease S,decrease P,and decrease Q.
• B) decrease D,decrease P,and decrease Q.
• C) increase D,increase P,and increase Q.
• D) increase D,increase P,and decrease Q.

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Definitions:

Risk-Free Rate

The hypothetical yield of a risk-free investment, typically mirrored by the interest rate on sovereign debt.

IRR Method

The Internal Rate of Return method, a capital budgeting technique used to evaluate the profitability of an investment or project.

Hurdle Rate

The minimum acceptable rate of return on an investment, used as a benchmark to determine the viability of the project or investment.

Capital-Budgeting

The process by which investors or managers evaluate and select long-term investments based on their potential to generate net revenues.