Which of the Following Would Cause the Quantity of Wheat

question 2

Multiple Choice

Which of the following would cause the quantity of wheat bread demanded to increase, but not the demand for wheat?

• A)​a reduction in the price of rye, used to produce rye bread
• B)​a new scientific study demonstrating that wheat bread reduces the risk of colon cancer
• C)​a decrease in the price of rye bread
• D)​an increase in the number of farmers growing wheat

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Definitions:

Market Risk Premium

The additional return an investor requires from a market portfolio over the risk-free rate, compensating for the risk of the investment.

Financial Leverage

The use of borrowed funds to increase the potential return on an investment.

Shareholder Leverage

The use of borrowed funds by shareholders to increase their potential returns from an investment.

Operating Leverage

A measure of how revenue growth translates into growth in operating income due to fixed costs in a company's business model.