Which of the following conditions exist in long-run competitive equilibrium?
I). P = LRAC
II). Individual firms operate at the most efficient scale of plant.
III). The level of output produced coincides with the minimum point on the LRAC curve.

• A.II and III.
• B.I and III.
• C.I, II and III.

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CFA Institute recommends maintaining records for at least ____ years.

• A.five
• B.seven
• C.ten

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It is important for any firm to determine its appropriate target cash balance:

• A.since most firms follow flexible policies of working capital management.
• B.because there is a trade-off between the benefit and cost of liquidity.
• C.because of the fluctuation in interest rates on marketable securities.

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A current account surplus reflects:

• A.high domestic private savings and investment, and government surplus.
• B.high domestic private savings, low domestic investment, and government surplus.
• C.high domestic private savings and investment, and government deficit.

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If the primary purpose of a tariff is to completely eliminate the price advantage of foreign competition, it will be expected to:

• A.raise either a large or a small amount of revenue depending on the magnitude of the tariff imposed.
• B.raise an amount of revenue equal to the amount of the tariff multiplied by the volume of exports.
• C.raise a relatively small amount of tax revenue.

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