An Increase in Total Assets

question 134

Multiple Choice

An increase in total assets:

• A) Means that net working capital is also increasing.
• B) Requires an investment in fixed assets.
• C) Means that shareholders' equity must also increase.
• D) Must be offset by an equal increase in liabilities and shareholders' equity.
• E) Can only occur when a firm has positive net income.

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Definitions:

Real Rate of Return

The rate of return on an investment after adjusting for inflation, representing the actual purchasing power of the investment's earnings.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, indicating how much the values diverge from the mean.

Correlation

A statistical measure that describes the extent to which two variables change together, indicating a relationship but not causality.

Dividend Yield

A financial ratio indicating how much a company pays out in dividends each year relative to its stock price.