______ is the situation where an organization earns above market returns.
a. Market returnability
b. Economic rent
c. Financial capacity
d. Market dominance
b. Economic rent
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What is a reason for the popularity of employee stock ownership plans (ESOPs)?
A. ESOPs must invest at least 51 percent of their assets in the company's own stocks. B. Employees can use ESOPs to buy their company during financial crises. C. ESOPs provide tax advantages to employers. D. The employees are provided with many more shares of stock than they actually own. E. ESOPs provide very high risk-free retirement income.
OutCode Inc. is an organization that tries to avoid the potential for violence or a lawsuit each time an employee is asked to leave the company. It does this by having the former employees meet with a specialized member of the HR staff to discuss their feelings while also getting help to find a new job. Which strategy does OutCode Inc. use in this scenario?
A. outplacement counseling B. outcome fairness C. an employee assistance program D. fair representation E. alternative dispute resolution
Realization is the presumption that a firm will remain in operation long enough to carry out its current plans. and in the normal course of its operations, realize changes in the fair values of its assets either by using those assets or selling them
Indicate whether the statement is true or false
Elaine loaned her brother, Mike, $175,000 to purchase a new home. Elaine does not charge Mike any interest on the loan. What are the tax consequences to Elaine and Mike?
A. If Mike has no net investment income, Elaine does not have to treat the forgone interest as a gift. B. Mike can deduct the interest that he is deemed to have paid Elaine. C. Elaine is treated as having made a gift of the forgone interest on the $175,000 loan to Mike. D. Elaine only has to impute interest on $75,000 of the loan to Mike.