Supernormal Growth Refers to a Firm That Increases Its Dividend

question 194

Multiple Choice

Supernormal growth refers to a firm that increases its dividend by:

• A) Three or more% per year.
• B) A rate which is most likely not sustainable over an extended period of time.
• C) A constant rate of 2 or more% per year.
• D) $.10 or more per year.
• E) An amount in excess of $.10 a year.

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Definitions:

Money Supply

The total capital available in an economy at a given moment, which includes cash, coins, and the money held in checking and savings accounts.

Value of Money

The purchasing power of money, indicating how much goods or services one unit of money can buy.

Excess Supply

A market situation where the quantity of a good or service supplied is greater than the quantity demanded at the current price.

Deflation

Deflation is a decrease in the general price level of goods and services in an economy over a period, indicating negative inflation.