Regarding New Inventions, Which of the Following Statements Is Not

question 136

Multiple Choice

Regarding new inventions, which of the following statements is not true?

• A)A new invention typically has little competition.
• B)This effective monopoly on the market earns the inventor abundant profit.
• C)That profit gets the attention of other potential inventors, who create competing products.
• D)Reduced to zero economic profits, the inventor goes out of business.

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Definitions:

Noncumulative

Describes preferences or rights that do not carry over or accumulate if they are not used within a certain period.

Nonparticipating

In the context of insurance or preferred stock, referring to policies or shares that do not entitle the holder to share in profits beyond a specified amount.

Stockholders

Individuals or entities that own shares in a corporation, thus holding an ownership stake.

Dividends in Arrears

Dividends on cumulative preferred stock that have not been paid in the period they were due, accumulating until paid by the corporation.