“Import quotas will create jobs, increasing the employment level of a nation.” Economic analysis indicates that this statement is incorrect in: A) the short run only. B) the long run only. C) both the long and short run.
a) short run only?
a ?
SR only. In LR, costs will be higher for other firms who buy from the protected firms and those firms will have to cut workforce.
answer was B - it says incorrect Which of the following statements regarding how different capital structure theories impact managers’ capital structure decisions is most accurate? According to: A) the static trade-off theory, debt will not be used if a company is in a high corporate tax bracket. B) MM’s propositions (assuming no taxes), companies have an optimal level of debt financing. C) pecking order theory, issuing new debt is preferable to issuing new equity
C
C sounds right. Issuing equity has a negative stigma, and issuing debt is cheaper due to the tax benefit.
Yes answer was C for that but i don’t understand why. In P order theory, debt is least favorable! The maturity structure for corporate debt is typically shorter in countries that have: A) more liquid stock and bond markets. B) lower rates of inflation. C) low rates of GDP growth.
B - Issuing debt is a good way for companies to use inflationary periods to their advantage since debt is a fixed income/payment security. Pecking order theory is related to the “signals” management sends to investors through its financing choices. According to pecking order theory, managers prefer to make financing choices that are least likely to send signals to investors. Financing choices under pecking order theory follow a hierarchy based on visibility to investors with internally generated capital being the most preferred, debt being the next best choice, and equity being the least preferred financing option.
Answer was C - lower GDP Conglomerate mergers are least likely for companies in which stages of the industry lifecycle? A) Mature Growth, Stabilization. B) Stabilization, Decline. C) Pioneer/Development, Rapid Growth.
can you show the explanation for why the econ question was B. what did u mean when u said "answer was B - it says incorrect "
B - Stable - Merger just cause decline - vulture pick up
will do …let me finish this test Which of the following is a disadvantage of bond insurance as an external credit enhancement? A) Its cost. B) It only provides protection against systematic risk, not against idiosyncratic risk. C) It covers only bond interest
A - ain’t notin fo free.
Import quotas will create jobs, increasing the employment level of a nation." Economic analysis indicates that this statement is incorrect in: A) the short run only. B) the long run only. C) both the long and short run. Your answer: C was incorrect. The correct answer was B) the long run only. The argument that trade restrictions protect jobs is of questionable validity. First, trade restrictions prevent trading partners from developing the purchasing power needed to buy import goods from the protected country, thus depressing the country’s own export industry. Second, the higher price of the protected domestic goods dampens domestic purchasing power, taking sales away from other domestic products. Third, the jobs that would have been created in the import industry are never created. The number of jobs protected by import restrictions will be offset by jobs lost in the import/export industry
cfaboston28 Wrote: ------------------------------------------------------- > will do …let me finish this test > > Which of the following is a disadvantage of bond > insurance as an external credit enhancement? > > A) Its cost. > > B) It only provides protection against systematic > risk, not against idiosyncratic risk. > > C) It covers only bond interest A is correct
cfaboston28 Wrote: ------------------------------------------------------- > Answer was C - lower GDP > > > Conglomerate mergers are least likely for > companies in which stages of the industry > lifecycle? > > A) Mature Growth, Stabilization. > > B) Stabilization, Decline. > > C) Pioneer/Development, Rapid Growth. A is correct
fack!
cfaboston28 Wrote: ------------------------------------------------------- > Import quotas will create jobs, increasing the > employment level of a nation." Economic analysis > indicates that this statement is incorrect in: > > A) the short run only. > > B) the long run only. > > C) both the long and short run. > > > Your answer: C was incorrect. The correct answer > was B) the long run only. > > The argument that trade restrictions protect jobs > is of questionable validity. First, trade > restrictions prevent trading partners from > developing the purchasing power needed to buy > import goods from the protected country, thus > depressing the country’s own export industry. > Second, the higher price of the protected domestic > goods dampens domestic purchasing power, taking > sales away from other domestic products. Third, > the jobs that would have been created in the > import industry are never created. > > The number of jobs protected by import > restrictions will be offset by jobs lost in the > import/export industry Dammit think we all misread this question as asking which is correct rather than incorrect. So obviously the answer is B. It is true in the SR (so A and C are out) and false in the LR (A is the correct answer–it makes the statement incorrect).