Is this situation consistent with a monopolistically competitive firm maximizingprofit? If yes, is it consistent with LR?P

Market Economy- A market economy is an economic system in which market forces, rather than a central…

Answered: Is this situation consistent with a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Technical analysis can only be profitable when: a. The market is weak form efficient b. The market is semi-strong form efficient c. The market is strong form efficient d. All of the above e. None of the above
6. What of the following might result from dropping an unprofitable customer? a. Sales levels would decrease b. Future business relations could suffer c. Costs would decline d Costs could stay the same in the short-term e. All of the above be
In financial markets, if there is an untapped profit opportunity, arbitrageurs will realize it and it will disappear. What does the EMH hypothesis say about the consequences of these arbitrageurs on prices?
When comparing the lower of cost to market the appropriate market value is determined before comparing it to the cost the purpose of the ceiling is to ensure that the write-down is sufficient to cover all expected gains O the purpose of the floor is to prevent an excessive gain from being recognized in the future the process is consistent with the principle of conservatism because the goal is to limit excessive swings in gross margin O000
The difference between the market value of the firm and the amount of laiabilities in the firm is known as market value added. Select one: True False
If a company decreases its selling price for its products. The Increase? O Total cost O Cost plus pricing O Break even quantity. O Profit it
A competitive firm O Has the market power to compete effectively. O Confronts a downward-sloping firm demand curve. O Is large enough relative to the market to be taken into account by competitors. OIs a price taker.
Operating leverage measures the: O Change in profit when sales changes. O Change in Contibution when sales changes. O Change in BEP when fixed cost changes. O Change in BEP when sales changes.
Setting a goal of profit maximization has all of the following drawbacks except: Multiple Choice investors understand that generally, more profit is better Risk may increase as profit changes Profit fails to take into account the timing of benefits Accurately measuring profit is almost impossible
Give typing answer with explanation and conclusion 5. Which of the following statements is correct? A-- All the answers are correct. B-- A more direct method of calculating the DOL is to use the following equation is DOL = (Sales - Variable Costs)/EBIT. C-- Because the amount of debt is determined by managerial choice, the business risk that a firm faces is also determined by management. D-- Fixed costs are those costs that are expected to change at the same rate as the firm’s sales. E-- If a firm’s operating costs are all variable, then any variation in sales will be less than the variation in EBIT.
Which of the following statement is correct about cost-benefit analysis? O A. Costs and benefits must be put into common units (such as dollars) if they are to be compared. O B. In general, if an action increases a firm's value by providing benefits with a value greater than any costs involved, then that action is not good for the firm's investors. C. In order for costs and benefits to be compared, they must typically be converted to common units but not converted to the same point in time. O D. A financial manager's decisions should provide benefits to the firm without incurring any costs. Click to select your answer.

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Is this situation consistent with a monopolistically competitive firm maximizing profit? If yes, is it consistent with LR? P