Using Borrowed Money to Increase the Rate of Return on Common

question 68

True/False

Using borrowed money to increase the rate of return on common stockholders' equity is called "trading on the equity."

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Definitions:

Positive Reinforcement

An increase in the future frequency of a behavior due to the addition of a stimulus immediately following a response.

Negative Reinforcement

A behavioral principle where the removal of an unpleasant stimulus strengthens a behavior, increasing its occurrence.

Negative Punishment

A behavioral control method where the removal of a desirable stimulus decreases the likelihood of a behavior recurring.

Avoiding Punishment

Engaging in behavior with the aim to prevent, escape from, or decrease the likelihood of negative consequences or sanctions.