- According to the Model of the Macro Economy in Figure

question 9

Multiple Choice

- According to the model of the macro economy in Figure 18.3,a shift from LRAS₁ to LRAS₂ will cause,ceteris paribus,

• A)A decrease in the level of output.
• B)A decrease in the price level.
• C)An increase in the unemployment level.

Assess the influence of retained earnings and the return on new investments on the growth rate in earnings.

Analyze the factors affecting a firm's price/earnings ratio and the implications of risk-adjusted cost of capital.

Understand the components and preparation of a merchandise purchases budget.

Learn how to prepare a budgeted income statement.

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Definitions:

Shares Outstanding

The cumulative amount of a company's shares that have been approved, distributed, and acquired by shareholders and currently possessed by them.

Debt-equity Ratio

A ratio used to express the relative use of equity and debt in funding a company’s assets.

Capital Spending

Expenditures by a company on major physical goods or services that are expected to generate economic benefits in the future.

Residual Dividend Policy

A strategy where a company pays dividends out of the residual or leftover equity only after all project capital needs are met.