Suppose That When Your Wealth Increases from $100,000 to $200,000

question 16

Multiple Choice

Suppose that when your wealth increases from $100,000 to $200,000, your holdings of stock mutual funds increases from $20,000 to $50,000. Your wealth elasticity of demand for stock mutual funds then is

• A)less than 1 and stock mutual funds are a necessity asset.
• B)greater than 1 and stock mutual funds are a luxury asset.
• C)less than 1 and stock mutual funds are a luxury asset.
• D)greater than 1 and stock mutual funds are a necessity asset.

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Definitions:

Articles Of Incorporation

These are formal documents filed with a governmental body to legally document the creation of a corporation.

Quorum

The minimum number of members required to be present at a meeting to make the proceedings of that meeting valid.

Shareholders Meeting

A gathering of the shareholders of a company where decisions regarding the company's affairs are discussed and voted on.

Model Nonprofit Corporation Act (MNCA)

A template legislation that provides a basis for the statute governing nonprofit corporations in some states.