As a Result of Consumption Smoothing,a Temporary Tax Rebate Tends

question 44

Multiple Choice

As a result of consumption smoothing,a temporary tax rebate tends to create a:

• A) big increase in spending now.
• B) big increase in spending over many years.
• C) small increase in spending now.
• D) small increase in spending over many years.

---

Definitions:

Stock Split

A stock split is a corporate action where a company divides its existing shares into multiple shares to boost liquidity, though the overall market capitalization remains unchanged.

Shares Outstanding

The total number of shares of a corporation's stock that are currently owned by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s officers and insiders.

Treasury Stock

Shares that were once outstanding and have been reacquired by the corporation, reducing the amount of outstanding stock on the open market.

Paid-In Capital

Funds that are received by a company from investors in exchange for stock, representing the capital provided by shareholders as a part of the equity of the company.