Certain Regulatory Changes (Such as Antitrust Regulation and Tax Laws)

question 22

Multiple Choice

Certain regulatory changes (such as antitrust regulation and tax laws) create incentives or disincentives for diversification that:

• A) create value.
• B) reduce value.
• C) are value-neutral.
• D) are managerial motives to diversify.

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Definitions:

Credit Side

The right side of an accounting ledger where increases in liabilities, equity, and revenue accounts, or decreases in assets and expense accounts are recorded.

Normal Balance

The side (debit or credit) of an account that is typically increased. For assets and expenses, it's debit; for liabilities, equity, and income, it's credit.

Account

A record that keeps track of all financial transactions related to an asset, liability, equity, revenue, or expense.

Increases

The action or process of becoming larger in quantity, size, amount, or degree in a financial or numerical context.