If the Demand Faced by a Firm Is Inelastic,selling One

question 16

Multiple Choice

If the demand faced by a firm is inelastic,selling one more unit of output will

• A)increase revenues.
• B)decrease revenues.
• C)keep revenues constant.
• D)increase profits.

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Definitions:

Straight-Line Depreciation

An accounting method that allocates the cost of an asset evenly over its useful life.

Voting Stock

Shares in a company that give the shareholder the right to vote on company matters, such as electing the board of directors.

Fair Value Option

An election that allows companies to report specific financial assets and liabilities at their fair values, with changes in fair value recognized in the income statement.

Acquisition Method

A set of procedures used in accounting to consolidate the financial statements of two companies in the event of a merger or acquisition.