If a corporation retains all its profits and distributes none of the profit to owners, how can owners benefit?
A) If the retained earnings are expected to create future profits, the market price of the firm's stock will increase and create a capital gain for stockholders if the stock is sold.
B) Shares of stock can be converted into bonds so stockholders will be able to earn coupon payments.
C) Owners will benefit by changing the board of directors.
D) Owners will only benefit if some profits are paid out in the form of dividends.
A
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Refer to Figure 12-11. If this is a constant-cost industry, what is the market price in the long-run equilibrium?
A) $5 B) $14 C) $15 D) $20
Net domestic product is equal to Gross Domestic Product minus
a. indirect business taxes b. depreciation c. personal taxes d. retained earnings e. consumption spending
A decrease in the price of rice from 50 cents to 40 cents a pound increases consumption from 16 to 20 tons a week in Gainesville and from 160 to 200 tons in the larger city of Miami. The elasticity of demand for rice is
a. greater in Miami than in Gainesville, even taking into account the population difference. b. greater in Gainesville than in Miami in spite of the population difference. c. equal in Gainesville and Miami regardless of the population difference. d. impossible to compare because of the population difference.
One of the most famous cartels is OPEC
a. True b. False Indicate whether the statement is true or false