All Else Equal,excess Capacity Means That More External Financing Is

question 105

True/False

All else equal,excess capacity means that more external financing is required to support increases in sales than would be needed if the firm previously operated full capacity.

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Definitions:

Tuition

The fee charged for instruction or education, typically by an educational institution such as a school or university.

Disposable Personal Income

Funds available to families for saving or spending after subtracting income taxes.

Retained Earnings

The portion of net income that is kept by a company rather than distributed to its shareholders as dividends, used for investment or paying off debt.

Social Insurance Contributions

Payments made to social security systems by employers, employees, or the self-employed, used to fund public programs such as pensions, unemployment benefits, and health care.