Question

What effect would each of the following have on the value of the firm?
(a) A new advertising campaign increases the sales of the firm substantially.
(b) A new competitor enters the market.
(c) The production department achieves a technological breakthrough, which reduces
production cost.
(d) The firm is required to install pollution-control equipment.
(e) The work force votes to unionize.
(f) The rate of interest rises.
(g) The rate of inflation changes.

Answer 1

Please see the answer after questions
What effect would each of the following have on the value of the firm?(a) A new advertising campaign increases the sales of the firm substantially. - will increase value of the firm
(b) A new competitor enters the market.
(c) The production department achieves a technological breakthrough, which reduces
production cost.- will increase value of the firm
(d) The firm is required to install pollution-control equipment.- will increase value of the firm
(e) The work force votes to unionize. - will effect value of the firm
(f) The rate of interest rises. - will effect value of the firm
(g) The rate of inflation changes.