If an Entity Is Able to Earn More on Borrowings

question 44

Multiple Choice

If an entity is able to earn more on borrowings than the cost of those borrowings the return on equity will:

• A) increase.
• B) decrease.
• C) be unchanged.
• D) vary.

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Definitions:

Perceptual Information

Data received by the senses that is then interpreted by the brain to understand the environment.

Violation-of-expectations

A method used in cognitive psychology to study the cognitive processes of infants, based on their reactions to events that defy their understanding of basic physical principles.

Object Permanence

The understanding that objects continue to exist even when they cannot be observed (seen, heard, touched, smelled, or sensed in any way).

Conservation of Volume

A cognitive ability in child development where the understanding that volume remains unchanged even when its shape changes is recognized.