Once It Becomes Clear the Economy Is Recovering

question 27

Multiple Choice

Once it becomes clear the economy is recovering,

• A) Financial stocks rise on expectations of increases in loan demand, housing constructions and security offerings.
• B) Consumer durable stocks rise on expectations of rising consumer confidence and personal income.
• C) Capital goods stocks rise on expectation of increases in business capital spending.
• D) Basic materials stocks rise on expectation of rising profit margins.
• E) Consumer staple stocks rise on expectations that consumers will continue to spend on necessities.

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Definitions:

Financing Alternatives

Various options available to a company or individual for raising capital, including loans, bonds, equity, and leasing.

Shares of Common Stock

Units of ownership in a corporation, giving holders voting rights and a share in the company's profits through dividends or stock appreciation.

Bonds Issuance

Bonds issuance is the process by which a corporation or government raises capital by selling bonds to investors, which then are obligated to pay back with interest at a later date.

Bond Sale

The process of issuing bonds to investors, generally to raise capital for a corporation or government.