We Can Predict That Resources Will Move into an Industry

question 113

Multiple Choice

We can predict that resources will move into an industry whenever

• A)accounting profits for firms in that industry are greater than zero.
• B)accounting profits for firms in that industry are zero.
• C)economic profits for firms in that industry are zero.
• D)economic profits for firms in that industry are greater than zero.
• E)economic losses for firms in that industry are minimized.

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Definitions:

Deferred Tax Implications

The financial effects on future tax payments or receipts due to temporary differences between the book value and tax base of assets and liabilities.

Issued Shares

Shares that have been allocated to shareholders by a company, representing ownership in the company.

Net Assets

Net assets represent the total assets of a company minus its total liabilities, indicating the actual value of a company’s equity held by shareholders.

Acquisition

The process by which one company takes over another company either by purchasing its assets or its stock.