Extra Capacity Can Serve to Intimidate and Preempt Competitors from Entering

question 68

True/False

Extra capacity can serve to intimidate and preempt competitors from entering the market.

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Definitions:

Retained Earnings

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

Income Before Taxes

Another term for pretax income, indicating the amount earned by a business before subtracting taxes.