What Is Dollarization

question 156

Multiple Choice

What is dollarization?

• A) a price reduction strategy where everything within a country is sold at a rounded dollar amount
• B) the complete elimination of U.S. currency from a nation's economy
• C) making the denominations of local currency identical to those in U.S. currency
• D) the process by which a country in whole or in part adopts the U.S. dollar as its official currency
• E) the practice of a country's using the U.S. banking system for its transactions

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Definitions:

Stock Dividends

These are dividends paid by a company to its shareholders in the form of additional shares of stock, rather than in cash.

Contributed Capital

Funds raised by a company through the issuance of shares to investors, representing the stockholders' equity apart from retained earnings.

Retained Earnings

The portion of net income left over for a business after it has paid out dividends to its shareholders, often used for reinvestment in the business or to pay down debt.

Small Stock Dividend

A dividend payment made in the form of additional shares, typically less than 25% of the existing shares.