List the Primary Reasons a Company Might Invest in Equity

question 73

Essay

List the primary reasons a company might invest in equity securities. Explain how each of these reasons helps to achieve the primary goal of a business entity-to make profit.

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Definitions:

Gross Demands

The total quantity of goods or services demanded across all consumers in the market before accounting for net effects such as substitution or income changes.

Initial Endowment

The initial distribution of wealth, goods, or resources that individuals or firms possess in an economic model.

Leisure

A period of free time not taken up by work, during which an individual can relax, enjoy hobbies, or engage in other activities that they find pleasurable.

Normal Good

A good for which demand increases as the income of individuals increases, all other factors being constant.