The Mere Fact That a Firm Is Earning High Rates

Multiple Choice

The mere fact that a firm is earning high rates of return on its asset indicates that

A) the firm is worth more as a going concern than as a dead one.
B) downsizing is likely to be an economically sound option for the business.
C) it is time to start growing the business again.
D) it might be wise to further limit the cash flows returned to investors.