The Lory Bookstore Used Internal Financing as a Source of Long-Term

question 11

Multiple Choice

The Lory Bookstore used internal financing as a source of long-term financing for 80% of its total needs in 2013.The company borrowed an additional 27% of its total needs in the long-term debt markets in 2013.What were Lory's net new stock issues in that year?

• A)-20%
• B)-7%
• C)7%
• D)20%
• E)27%

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Definitions:

Door-In-The-Face Technique

A persuasion strategy whereby a large, unreasonable request is made first with the expectation of being refused, followed by a smaller, more reasonable request.

Foot-In-The-Door Technique

A persuasion strategy involving getting a person to agree to a small request as a precursor to making a larger request.

Foot-In-The-Door Phenomenon

A psychological tactic wherein agreeing to a small request increases the likelihood of agreeing to a larger request later.

Authority Figure

An individual who holds a position of power, influence, or respect, often within a hierarchical structure, and whose directives are expected to be followed.