Which of the Following Is an Example of a Capital

question 53

Multiple Choice

Which of the following is an example of a capital good?

• A)A new car sold to a family
• B)A metal-stamping machine used to produce cars sold to an automaker
• C)A new CD player sold to an automaker for installation in a car
• D)A new CD player sold to a teenager

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Definitions:

Accounts Payable

Accounts Payable is the account showing the amount a company owes to suppliers or vendors for goods or services purchased on credit.

Target Capital Structure

The optimal mix of debt, equity, and other financing sources that a company aims to maintain to fund its operations and growth.

Dividend Payout Ratio

A financial metric that measures the percentage of a company's earnings paid out to shareholders as dividends.

Capital Budget

The process and plan for determining and allocating resources for capital or investment projects within an organization.