Answered

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If a firm cannot invest retained earnings to earn a rate of return the required rate of return on retained earnings, it should return those funds to its stockholders

Sagot :

Parrain

As regards this statement on funds being returned to stockholders, this is TRUE.

Why is this statement true?

In theory, the reason why stockholders leave retained earnings with the company they invested in, is because the stockholders cannot find other ways to make the required return.

If the firm is therefore unable to make this required return, they will have to return it to the shareholders who will then find a way to invest in other things to make their required returns.

Find out more on required returns at https://brainly.com/question/15049289.

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