Which of the Following Best Explains Why Assembly-Line Workers in the United

question 80

Multiple Choice

Which of the following best explains why assembly-line workers in the United States earn significantly more than assembly-line workers in Mexico?
I. The supply of low-skilled laborers, such as those that work on assembly lines, is higher in Mexico.
II. The demand for assembly-line workers is higher in the United States.
III. Assembly-line workers are more productive in the United States.

• A) I and II only
• B) II and III only
• C) I and III only
• D) I, II, and III

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Definitions:

Times Interest Earned

A financial ratio that measures a company's ability to cover its interest expenses with its earnings before interest and taxes.

Retained Earnings

The portion of a business's profits not distributed to shareholders as dividends but kept back in the company for reinvestment or to pay debt.

Sustainable Growth Rate

The maximum rate at which a company can grow its sales and earnings without increasing leverage or equity financing.

External Financing

Funds a company raises from outside sources, like bank loans, issuing bonds, or equity financing from investors, to support its operations and growth.