Which of the Following Is a Possible Explanation for the Reason

question 9

Multiple Choice

Which of the following is a possible explanation for the reason that American steelmakers continued to invest in less efficient OH technology instead of newer more efficient BOF technology throughout the 1950s?

• A)The replacement effect
• B)Strategic intent
• C)Strategic stretch
• D)Efficiency effect
• E)The sunk cost effect

---

Definitions:

Consolidated Retained Earnings

The portion of net earnings not paid out as dividends, but retained by the company to reinvest in its core business, or to pay debt, reported in the consolidated financial statements.

Subsidiary's Adjusted Income

The net income of a subsidiary company after making adjustments for fair value measurements, currency translation, and other accounting policies.

Dividends

Payments made by a corporation to its shareholder members, distributing a portion of the company's earnings.

Notes Payable

A written promise to pay a specified sum of money, usually with interest, by a certain date, classified as a liability on the balance sheet.