A Potential Obligation That Depends on the Future Outcome of Past

question 109

True/False

A potential obligation that depends on the future outcome of past events is a contingent liability.

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Definitions:

Constant-Cost Industry

An industry in which the costs of production (including input prices) remain constant regardless of changes in the industry's output level.

Long-Run Equilibrium

A situation in which, after all adjustments have been made, all firms in a perfectly competitive market earn zero economic profit and no firm has an incentive to change its output.

Market Price

The existing rate at which a product or service may be purchased or sold within a market environment.

Competitive Market

A market structure where many firms offer products or services that are similar, leading to high levels of competition.