If Children Go to School and Become Productive Members of Society

question 24

Multiple Choice

If children go to school and become productive members of society,

• A) a negative externality is created by the schools.
• B) a positive externality is created by the schools.
• C) no externality is created by the schools.
• D) an externality is created that may be positive or negative.

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Definitions:

EBIT

A profitability metric for a company that omits expenses related to interest and income taxes, known as Earnings Before Interest and Taxes.

ROE

Return on Equity, a measure of a corporation's profitability that reveals how much profit a company generates with the money shareholders have invested.

Repurchase Shares

The act of a company buying back its own shares from the marketplace, reducing the amount of outstanding stock.

Debt-Equity Ratio

A ratio showcasing the relative utilization of debt and equity in the financial structuring of a company’s assets.