The Zolo Co

question 44

Multiple Choice

The Zolo Co. just declared that they are increasing their annual dividend from $1.00 per share to $1.25 per share. If the stock price remains constant, then:

• A) The capital gains yield will decrease.
• B) The capital gains yield will increase.
• C) The dividend yield will increase.
• D) The dividend yield will also remain constant.
• E) Neither the capital gains yield nor the dividend yield will change.

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Definitions:

Checkable Deposits

Deposits in financial institutions that can be withdrawn by writing a check or using a debit card.

Reserves

Assets held by financial institutions or central banks as a requirement or for ensuring liquidity in times of need, including cash, deposits, or securities.

Money Supply

The Money Supply is the total amount of monetary assets available in an economy at any specific time, including cash, coins, and balances held in checking and savings accounts.

Interest Rates

The expense incurred when taking out a loan, usually shown as a percent of the total amount loaned.