The Modigliani and Miller (MM) articles implicitly assumed, among other things, that outside stockholders have the same information about a firm's future prospects as its managers. That was called "symmetric information," and it is questionable. The introduction of "asymmetric information" led to the development of the "signaling" theory of capital structure, which postulated that firms are reluctant to issue new stock because investors will interpret such an act as a signal that the firm's managers are worried about its future. Other actions give off different signals, and the end result is that capital structure is affected by managers' perceptions about how their financing decisions will affect investors' views of the firm and thus its value.
Answer the following statement true (T) or false (F)
True
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Disaggregation refers to breaking down end-product requirements into various requirements. Which of the following is NOT one of these requirements?
a. materials requirements b. labor requirements c. machine capacity requirements d. government audit requirements
Four entrepreneurial students want to open a shaved ice business during the coming summer
Maxine thinks that demand will be high and therefore they should purchase a large stand and acquire a premium ice shaving machine. Minnie feels strongly that demand will be low and that they should purchase a tarp and some basic hand tools to work the ice. Midelia is pretty sure that demand will fall in-between these two extremes, so they can get by with a shack and a used ice shaving machine. Their financial wizard of the bunch, Probableah, has estimated the costs, revenues, and likelihoods of each level of demand and created the table shown below. What is the expected profit for this venture? Demand Total Revenue Total Expenses Probability Low $500 $15 .2 Medium $2,000 $125 .3 High $5,000 $519 .5 A) $1700 B) $2300 C) $2900 D) $3300
Jamie is a shoe designer. She developed a new type of high-heeled shoe at a reasonable price point. It is time to decide how the shoe should be distributed. Jamie knows that the shoe will require adequate service from retailers at the point of purchase. She should use an exclusive distribution strategy.
Answer the following statement true (T) or false (F)
What focuses on using information about customers to create marketing strategies that develop and sustain desirable customer relationships?
A. Customer relationship management B. Electronic data interchange C. Business-to-consumer marketing D. Strategic partnerships E. The marketing concept