One Reason Why the Soviet Union Grew Slowly in the 20th

question 92

Multiple Choice

One reason why the Soviet Union grew slowly in the 20th century compared to the United States and Western Europe was that it:

• A)did not invest as much in capital goods.
• B)invested in too many consumer goods.
• C)licensed too many private enterprises, creating destructive competition.
• D)did not provide incentives for individuals to produce what consumers valued.

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Definitions:

Annual Dividend

The total amount of money paid to shareholders from a company's profits over the course of a year per share of stock.

Floatation Costs

Expenses incurred by a company in issuing new securities, including underwriting fees and legal and administrative fees.

Cost of Retained Earnings

The rate of return that shareholders expect on the earnings that a company keeps and reinvests in its operations.

Risk Premium

The extra return expected by an investor for holding a risky asset rather than a risk-free asset.