Building a Model for Long-Term Forecasting Reveals Points in the Future

question 20

Multiple Choice

Building a model for long-term forecasting reveals points in the future where the firm will need ________ when retained earnings are not enough to fund planned future investments.

• A)mergers
• B)external financing
• C)stock dividends
• D)dividend payments

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Definitions:

Tax Burden

The measure of the financial charge or impact of taxes on an individual or a corporation.

Excise Tax

A tax on specific goods or services, such as tobacco, alcohol, and gasoline, designed to raise revenue and/or discourage consumption of certain products.

Equilibrium

A state in which the conflicting forces of demand and supply are in balance. When a market is in equilibrium, the decisions of consumers and producers are brought into harmony with one another, and the quantity demanded will equal the quantity supplied.

Revenue

Aggregate income a company secures from its sales of products or rendering of services in a given period.