If We Observe an Increase in the Price of a Good

question 159

Multiple Choice

If we observe an increase in the price of a good and an increase in the amount of the good bought and sold, this could be explained by

• A) an increase in the supply of the good.
• B) an increase in the demand for the good.
• C) a decrease in the demand for the good.
• D) a decrease in the supply of the good.

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Definitions:

Acquisition of Additional Shares

The purchase of more shares in a company, either to increase an existing stake or as a strategic move in corporate acquisitions.

Dividends

Payments made by a corporation to its shareholder members, usually derived from the company's profits.

Consolidated Statement of Cash Flows

A financial statement that shows the cash inflows and outflows of a parent company and its subsidiaries, revealing how cash is generated and used over a period.

Financing Activity

Transactions involving changes in equity and long-term liabilities on the company's balance sheet, such as issuing shares, taking out loans, or paying dividends.