Which Principle Dictates That Managers Should Receive a Raise in Pay

question 41

Multiple Choice

Which principle dictates that managers should receive a raise in pay based upon their contributions to the organization, and not based on their gender?

• A)restorative justice
• B)reparative justice
• C)distributive justice
• D)frontier justice
• E)spatial justice

Recognize the relevance of yield-to-maturity and debt rating in estimating the cost of debt.

Understand the potential errors of using WACC indiscriminately for all project evaluations.

Recognize the debate between using market value versus book value for estimating WACC.

Understand the concept of the appropriate discount rate in the context of capital budgeting.

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Definitions:

Producer Surplus

The gap between what sellers are prepared to accept for a product or service and the real amount they end up getting.

Excess Quantity

The situation where the supply of a product exceeds the demand for it at a specific price point, leading to a surplus.

Deadweight Loss

A loss of economic efficiency that can occur when the equilibrium for a good or a service is not achieved.

Market Equilibrium

The state in which the supply and demand for a good or service are balanced, leading to a stable price.