The Change in Capital Stock in a Period Is Equal

question 222

Multiple Choice

The change in capital stock in a period is equal to

• A) the ratio of the amount of the capital at the beginning of the period to the amount of depreciation.
• B) the amount of the capital stock at the beginning of the period plus gross investment minus depreciation.
• C) the amount of the capital at the beginning of the period plus gross investment.
• D) the amount of the capital at the beginning of the period minus net investment.

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Definitions:

P/E Ratio

The price-to-earnings ratio, a measure of a company's current share price relative to its per-share earnings.

Debt-equity Ratio

A measure of a company's financial leverage calculated by dividing its total liabilities by its shareholder equity, indicating how much debt is used to finance assets.

Book Value

The net value of a company's assets minus its liabilities, often used to estimate the value of a company if it were to be liquidated.

Vertical Acquisition

A corporate strategy where a company acquires another company that operates in the production process of the same industry, either as a supplier or distributor.