Earnings Per Share

question 47

Multiple Choice

Earnings per share:

• A)will increase if net income increases and the number of shares outstanding decreases.
• B)will increase if net income decreases and the number of shares outstanding increases.
• C)is defined as the addition to retained earnings divided by the number of shares outstanding.
• D)is the total amount of dividends paid per year on a per share basis.
• E)must increase at the same rate as the net income.

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Definitions:

Intrinsic Motivation

Wanting to perform an activity for its own sake.

Overjustification Effect

The tendency for intrinsic motivation to diminish for activities that have become associated with rewards.

Social Comparison Theory

A concept that people evaluate their own abilities and opinions by comparing themselves to others.

Introspection

The process by which a person examines the contents of his or her mind and mental states.