Laws That Seek to Prevent Certain Practices That Might Reduce

question 9

Multiple Choice

Laws that seek to prevent certain practices that might reduce competition and thus increase prices are called _____.

• A) tax laws
• B) consumer laws
• C) antitrust laws
• D) contract laws

---

Definitions:

Retaining Earnings

The portion of net income that is not distributed to shareholders but is kept by the company to be reinvested in its core business or to pay debt.

Flotation Cost

The total costs associated with issuing new securities, including but not limited to underwriting, legal, and registration fees.

Equity Capital

Funds raised by a company through the sale of common or preferred stock, representing ownership interest in the company.

Marginal Tax Rate

The tax rate on the last unit of income.