You will receive better pay
Answer:
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Explanation:
Answer: Option C
Explanation: In simple words, inelastic demand refers to a situation when the demand of the buyer does not change as per the price of the commodity. Thus, the price does not increase or decrease with decrease or increase in demand.
Hence the farmers should decrease the supply as there would be no profit for them to supply a product that has an inelastic demand.
Example: A company spends $5 million to buy prime real estate on which to build a new manufacturing factory. The land is worth $5 million. This is not financial leverage because the corporation is not using borrowed funds to purchase the land.
If the same corporation spent $2.5 million of its own money and $2.5 million in borrowed funds to purchase the same piece of real estate, the company is utilizing financial leverage.
Define: the utilization of fixed expenditures to increase the expected risk and potential return
Explanation: When purchasing assets, the corporation has three alternatives for financing: stock, debt, and leases. Apart from equity, the remaining choices have fixed costs that are lower than the expected income from the asset.
