In October 2008, the Stock Market Crashed, Falling by ________

question 21

Multiple Choice

In October 2008, the stock market crashed, falling by ________ from its peak value a year earlier.

• A) over 40 percent
• B) over 30 percent
• C) over 50 percent
• D) over 25 percent

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Definitions:

Deficit

A debit balance in the retained earnings account.

Retained Earnings

The portion of net earnings not distributed as dividends but retained by the company to reinvest in its core business or to pay debt.

Treasury Stock

Shares that were once issued and outstanding but were subsequently repurchased by the company, reducing the number of shares on the market.

Organizational Expenses

Costs related to the formation and operation of a business entity, such as legal fees, accounting services, and incorporation fees.