Johnson, Inc has just ended the calendar year making a sale in the amount of 10,000 of merchandise purchased during the year at a total cost of 7,000.
Although the firm paid in full for the merchandise during the year, it is yet to collect at year end from the customer. The net profit and cash flow from this sale for the year are ________.
A) 3,000 and 10,000, respectively
B) 3,000 and -7,000, respectively
C) 7,000 and -3,000, respectively
D) 3,000 and 7,000, respectively
Question 2
Changes in risk aversion, and therefore shifts in the SML, result from changing tastes and preferences of investors, which generally result from various economic, political, and social events.
Indicate whether the statement is true or false
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