Professional Employer Organizations (PEOs)are Especially Attractive to Small and Mid-Sized

question 61

Multiple Choice

Professional employer organizations (PEOs) are especially attractive to small and mid-sized businesses for all of the following reasons except

• A)reduced costs.
• B)wider range of benefits.
• C)freeing up computer resources.
• D)improved service quality.

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Definitions:

Total Equity

The total value of a company’s assets minus its liabilities, representing the ownership interest of the shareholders.

Net Income

The total amount of profit a company earns after taxes and all expenses have been deducted from revenues, commonly referred to as the bottom line.

Sustainable Growth Rate

The highest speed at which a business can expand its profits without having to raise its debt levels or issue more equity.

Retention Ratio

The percentage of net income that is retained to be reinvested in the business, rather than being paid out as dividends.