Unemployment Compensation Is

question 42

Multiple Choice

Unemployment compensation is:

• A)an automatic stabilizer because it rises as income increases, slowing an economic expansion.
• B)an automatic stabilizer because it falls as income increases, slowing an economic expansion.
• C)an automatic stabilizer because it falls as income decreases, slowing an economic contraction.
• D)not an automatic stabilizer.

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Definitions:

Dividends

Money paid out to shareholders by a corporation, usually as a share of profits.

Retained Earnings

Profits that a company keeps or reinvests, rather than distributing to stockholders as dividends.

New Stock

Issuance of additional shares by a company to raise capital, which can dilute existing shareholders' ownership percentage.

New Equity

Capital raised by a company through the issuance of common or preferred stock, increasing the shareholders' equity.