Which of the Following Statements Regarding Earnings Per Share (EPS)is

question 32

Multiple Choice

Which of the following statements regarding earnings per share (EPS) is false?

• A)It increases when treasury stock is acquired.
• B)It increases when net income increases.
• C)It decreases when additional shares of common stock are issued.
• D)It decreases when the number of shares of common stock authorized increases.

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Definitions:

Expected Monetary Value(EMV)

A calculation used in decision-making under risk, representing the sum of possible outcomes weighted by their respective probabilities and monetary impacts.

Expected Opportunity Loss Decision

A decision-making approach that minimizes the expected loss due to not choosing the best option under uncertainty.

State of Nature

A term used in decision theory and statistics to refer to the actual but unknown condition or outcome of a particular phenomenon.

Decision Tree

A decision tree is a graphical representation used in decision analysis to display choices and their possible outcomes, including chance event outcomes, resource costs, and utility.