If Total Liabilities Decreased by $30,000 and Stockholders' Equity Increased

question 74

Multiple Choice

If total liabilities decreased by $30,000 and stockholders' equity increased by $20,000 during a period of time, then total assets must change by what amount and direction during that same period?

• A) $50,000 decrease
• B) $10,000 decrease
• C) $10,000 increase
• D) $50,000 increase

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Definitions:

Short-run Phillips Curve

A visual diagram illustrating the short-term inverse correlation between inflation rates and unemployment rates.

Policymakers

Individuals or groups responsible for making and implementing policies, especially in government and legislative contexts.

Natural-rate Hypothesis

The theory suggesting that there is a specific level of unemployment that exists in an economy that is not eliminated by monetary policy in the long run.

Favorable Supply Shock

An unexpected event that suddenly increases the supply of a product or service, resulting in decreased prices and increased quantity.