Figure 14-1 -Refer to Figure 14-1. How Would an Increase in the Increase

question 198

Multiple Choice

Figure 14-1
-Refer to Figure 14-1. How would an increase in the money supply move the economy in the long run?

• A) from C to A
• B) from C to B
• C) from C to A to C again
• D) from C to D

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Definitions:

Par Common Stock

The nominal or face value assigned to a share of common stock in the company’s charter.

Cumulative Preferred Stock

Stock that has a right to receive regular dividends that were not declared (paid) in prior years.

Par Value

The nominal or face value assigned to a share of stock or bond, typically used in accounting as a base value rather than market value.

Dividend Liability

Refers to the amount a company owes to its shareholders after the board of directors declares a dividend but before the company has actually paid it.