The Three Alternatives for Increasing Return on Investment Include Increasing

question 51

True/False

The three alternatives for increasing return on investment include increasing assets such as receivables, increasing revenues, and decreasing costs. (In all cases assume that all other items stay the same.)

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Definitions:

Common Stock Options

Financial derivatives that give the holder the right, but not the obligation, to buy or sell shares of a company's common stock at a set price before the option expires.

Corporate Capital Structure

The mix of debt, equity, and other securities that a company uses to finance its activities.

Diluted Earnings Per Share

A metric that calculates a company's earnings per share (EPS) if all convertible securities were converted into common stock, potentially lowering the EPS.

Convertible Debt

A type of bond or loan that can be converted into a predetermined amount of the company's equity at certain times during its life, usually at the discretion of the bondholder.