Generally,a Firm That Maintains a Low Level of Retained Earnings

question 31

Multiple Choice

Generally,a firm that maintains a low level of retained earnings will do which of the following?

• A)maximize its share price in the long run
• B)minimize its share price in the long run
• C)maximize its market risk in the long run
• D)minimize its market risk in the long run

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Definitions:

Labor Supply Curve

A visual chart that displays how the wage rate correlates with the amount of labor that workers are prepared to offer.

Substitution Effect

The economic principle that as prices rise, consumers will replace more expensive items with less costly alternatives.

Income Effect

The impact that changes in either personal or economic income have on how much of a good or service is sought after.

Quantity of Labor

The total hours of work or number of workers employed by a firm or within an economy, which can influence production output levels.