On a Particular Day, a Mining Company Reveals That, Due

question 16

Multiple Choice

On a particular day, a mining company reveals that, due to new extraction technology, the extractable yield from several of its nickel/lead mines has risen by 15%. Which of the following is the LEAST likely consequence of such an announcement?

• A) The price of the stock would rise.
• B) Investors would determine that the estimates of the firm's value on the date prior to the announcement were too high.
• C) Investors would increase their forecast of future cash flows in that firm.
• D) Investors would revise their estimates of the net present value (NPV) of the firm.

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Definitions:

Individual Rights

Rights that are guaranteed to individuals, typically protecting them from government infringement.

Necessary and Proper Clause

A provision in the U.S. Constitution granting Congress the power to pass all laws deemed necessary and proper for carrying out its duties.

Congress Powers

The legislative powers granted to the U.S. Congress by the Constitution, including taxing, spending, and regulating interstate commerce.

Rational Basis Test

A standard of judicial review that requires a law to be rationally related to a legitimate government interest.