The Balances in Selected Accounts of Rerun Company Increased (Decreased) $\begin{array}{ll}\text { Accounts payable } & \$ 10,000 \\\text { Bonds payable } & (12,000) \\\text { Common stock } & 4,000\end{array}$

question 89

Multiple Choice

The balances in selected accounts of Rerun Company increased (decreased) as follows: $\begin{array}{ll}\text { Accounts payable } & \$ 10,000 \\\text { Bonds payable } & (12,000) \\\text { Common stock } & 4,000\end{array}$ Rerun Company declared and paid dividends of $8,800. The cash flow from financing for Rerun Company was:

• A) $(16,800)
• B) $(6,800)
• C) $6,800
• D) $16,800

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Definitions:

Well-Diversified Portfolio

A portfolio that contains a wide variety of investments across different asset classes and sectors to minimize risk.

Single Index Model

A simplified financial model that describes the return of a security as a linear function of the return of a market index, plus some idiosyncratic noise.

Well-Diversified Portfolio

A collection of investment assets reduced in risk through spreading investments across various securities, sectors, or asset classes.

Single Index Model

A simplification of market models that uses a single factor (usually a market index) to model all securities' returns.