An Investing Firm Consolidates the Variable Interest Entity If It

question 29

Short Answer

An investing firm consolidates the variable interest entity if it absorbs the majority of the entity's expected ____________________ if they occur,receives a majority of the entity's expected ______________________________ if they occur,or both.

---

Definitions:

Diminishing Marginal Returns

The principle that adding an additional factor of production results in a smaller increase in output after a certain point.

Total Product

The total output or production by a firm using a given amount of inputs within a specific period.

Variable Input

A resource or factor of production whose quantity can be changed easily in the short term to adjust production levels.

Diminishing Marginal Returns

An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other variables remain at a constant.