In the 1920s, Few Americans Could Afford Automobiles

question 1

True/False

In the 1920s, few Americans could afford automobiles.

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Definitions:

Capital Intensity Ratio

A metric that measures the amount of assets required to generate one dollar of revenue; the higher the ratio, the more capital-intensive the business.

Dividend Payout Ratio

The fraction of net earnings a firm pays to its shareholders as dividends, expressed as a percentage of the company’s total net income.

Cash Dividends

Payments made by a corporation to its shareholders, representing a portion of the corporate profits.

Net Income

The total earnings of a company after all expenses and taxes have been deducted from total revenue; it is often referred to as the bottom line.