If the Supply Curve for a Product Is Vertical, Then

question 105

Multiple Choice

If the supply curve for a product is vertical, then the elasticity of supply is:

• A)​equal to zero.
• B)​equal to one.
• C)​greater than one but less than infinity.
• D)​equal to infinity.

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Definitions:

Lockbox Plan

A cash management tool in which incoming cheques for a firm are sent to post office boxes rather than to corporate headquarters. A local bank will collect the contents of the lockbox and deposit the cheques into the company’s local account.

Net Positive Float

The excess of funds available for use due to the time difference between when a check is deposited and when it clears.

JIT System

Just-In-Time System, an inventory management strategy that aligns raw-material orders directly with production schedules.

Accounts Payable

The amounts a company owes to its suppliers or vendors for goods or services received but not yet paid for; a liability on the balance sheet.