Which of the Following Best Explains When Value Is Created

question 14

Multiple Choice

Which of the following best explains when value is created?

• A) When the return on an investment is less than is required for that risk class
• B) When the return on an investment is greater than is required for average investments
• C) When the expected return on an investment is greater than is required for that risk class
• D) When the risk level on an investment is higher than is required for that return

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Definitions:

Board of Directors

A group of individuals elected by the shareholders of a corporation to oversee the management and make major decisions affecting the company's policy and strategy.

MBCA

The Model Business Corporation Act, a set of statutory provisions designed for the incorporation and operation of a business corporation.

Incorporator

The individual or entity that files the articles of incorporation, thus legally forming a corporation.

Preincorporation Contracts

Agreements entered into on behalf of a corporation not yet formed, which the corporation may later ratify or reject.