Discounting the Future Refers to

question 98

Multiple Choice

Discounting the future refers to

• A) focusing on gains in the long run.
• B) failing to consider inflationary costs.
• C) underestimating the short-term effects of a decision.
• D) weighing short-term benefits more heavily than long-term benefits.
• E) failing to consider the effects of new entrants into the industry.

---

Definitions:

Capital Stock

The total amount of shares that a corporation is authorized to issue as stated in its articles of incorporation.

Dividend

A portion of a company's earnings distributed to its shareholders.

Cumulative Preferred Stock

A type of preferred stock where dividends accumulate if not paid, and must be paid out before dividends to common stockholders.

Common Stock

Equity security representing ownership in a corporation, with rights to vote on corporate matters and receive dividends.