When using equity financing, firms run the risk of ________.
A) losing a controlling interest to shareholders
B) acquiring capital through the sale of shares
C) incurring an unmanageable amount of debt
D) falling victim to currency exchange rates
A) losing a controlling interest to shareholders
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The larger the fraction of an investment financed by borrowing,
A) the smaller the potential return and potential loss on that investment. B) the greater the potential return and the smaller the potential loss on that investment. C) the smaller the potential return and the greater the potential loss on that investment. D) the greater the potential return and potential loss on that investment.
In the long run in a monopolistically competitive market, a firm will, in theory,
A) earn economic profits. B) suffer losses. C) break even. D) earn zero accounting profits.
Suppose that a study is released stating that as people increase the number of times they brush their teeth each day, they increase the number of times they go to the gym each week. This is best described as an example of
A. positive correlation. B. negative correlation. C. positive causation. D. negative causation.
Which of the following could trigger supply-side inflation?
A. A decrease in the wage rate for all workers B. An increase in raw materials’ prices C. An increase in the productivity of capital D. An increase in the labor force