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by mrh0057
1544 days ago
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It’s suppose to be the value you added. The investors get payment for the risk they take by investing in or loaning money to the company. If a company has monopoly power and/or gets bailed out by the government consistently there is no risk to investors. What ends up happening is rent seeking a behavior by theses companies and they will also take unnecessary risks since they are incentivized to. |
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