Fixed Costs Per Unit

question 23

Multiple Choice

Fixed costs per unit:

• A) Vary inversely with changes in volume
• B) Change regardless of changes in volume
• C) Will not change over the relevant range
• D) Increase with an increase in volume

Comprehend the effect of changes in dividends, growth rates, and required returns on stock values.

Identify the tax implications of dividends for individuals and corporations.

Determine the effects of corporate dividend policies on stockholder wealth.

Understand the assumptions and limitations of the constant dividend growth model.

---

Definitions:

Human Capital

The capabilities, understanding, and expertise held by a person or group, considered in light of their worth or expense to a company or nation.

Wage Disparity

The difference in earnings between two or more groups within a workforce, often based on gender, race, occupation, or education level, that can lead to inequality.

Median Earnings

The middle value of earnings in a given distribution, with an equal number of persons earning more and less than this value.

Efficiency-wage Model

A theory suggesting that higher wages can lead to increased productivity by attracting better workers and motivating them to work harder.