We Can Safely Say That Total Output Can Increase If

question 240

Multiple Choice

We can safely say that total output can increase if there is a(n)

• A) increase in the size of the labor force and a decrease in the productivity of workers.
• B) decrease in the size of capital and an increase in the productivity of machines.
• C) increase in the number of machines per worker.
• D) decrease in the number of workers per machine.

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Definitions:

Flotation Costs

Expenses incurred by a company in issuing new securities, including underwriting, legal, and registration fees, reiterating the cost aspect of raising equity or debt.

Retained Earnings

The portion of a company's net earnings not paid out as dividends but retained by the company to be reinvested in its core business or to pay debt.

Constant Growth

A model assuming that a company's dividends will continue to grow at a constant rate indefinitely, used in valuing stocks.

Preferred Stock

A class of stock that has a higher claim on assets and earnings than common stock, often with fixed dividends.