Profits That Are Reinvested in a Firm Rather Than Paid

question 54

Multiple Choice

Profits that are reinvested in a firm rather than paid to the firm's owners are called

• A)dividends.
• B)stock options.
• C)retained earnings.
• D)corporate bonds.

Appreciate the role of social media and direct contact in political and organizational communications.

Understand the factors that may prolong or expedite the decision-making process.

Recognize the impact of stress and job demands on managerial decision-making strategies.

Be aware of the benefits of involving others in problem diagnosis and decision-making.

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Definitions:

Equity Capital

Funds raised by a company through the sale of shares in return for ownership interest, without obligation to repay the investment.

Issuing Bonds

The act of a corporation or government raising capital by borrowing from investors through the sale of bond securities.

Reinvesting Earnings

The practice of using a company's profits to invest back into the business to fund growth, expansion, or improvements rather than distributing it to shareholders as dividends.

Strategic Plan

A document that outlines an organization's long-term goals and the strategies it will use to achieve them.