A Firm Uses Financial Leverage When It

question 257

Multiple Choice

A firm uses financial leverage when it:

• A)replaces labor with capital.
• B)borrows money from a bank to enlarge a factory.
• C)raises the price of a product when demand is inelastic.
• D)gets a volume discount from a supplier.

---

Definitions:

Fixated

The psychological state or condition in which an individual becomes obsessively focused on an object, concept, or goal, often at the expense of other interests.

Freudian Stage

Stages in psychoanalytic theory proposed by Sigmund Freud, which are believed to be critical in the development of personality, sexuality, and psychological function, transitioning from infancy to adulthood.

Developmental Urges

Innate or instinctual drives that motivate individuals to pursue growth or change as part of their development.

Anal Stage

A psychoanalytic concept introduced by Freud, referring to the developmental phase where a child's focus is on bowel and bladder elimination and control.