The value added created by a firm is:
A)Nearly all distributed to the most powerful stakeholders, especially to members of the Board of directors
B)Completely reinvested into the expansion and improvement of its business activities
C)Appropriated exclusively by its owners
D)Distributed primarily to employees (wages), lenders (interest), government (taxes), and owners (dividends)

Question

Quizplus · Accepted Answer

The value added created by a firm is typically distributed primarily to employees in the form of wages, lenders in the form of interest, government in the form of taxes, and owners in the form of dividends. While some of the value added may be reinvested in the business or appropriated by owners, these are not the primary ways in which the value added is typically distributed. Additionally, it is unlikely that the value added would be nearly all distributed to the most powerful stakeholders, as this would not be in the best interests of the firm or its other stakeholders.

The Value Added Created by a Firm Is