At the End of 2009, What Is the Maximum Number

question 65

Essay

At the end of 2009, what is the maximum number of shares that could possibly be issued if all stock options and awards are exercised? Explain why V Co. used only 3.3 million in its computation for 2009.

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Definitions:

Substitute Resource

Alternative resources or inputs that can be used in place of another in the production process to produce a similar type of output.

Productivity

The efficiency with which input resources are converted into outputs, often measured as the ratio of output to input in a given time period.

Law of Diminishing Returns

The principle that as investment in a single factor of production increases, holding all others constant, the incremental gains in output will eventually decrease.

Law of Diminishing Marginal Utility

states that as a person consumes more of a good or service, the utility (satisfaction) gained from each additional unit decreases.