Which of the Following Statements Is TRUE

question 14

Multiple Choice

Which of the following statements is TRUE?

• A)Neither a share dividend nor a share split will result in net gains or losses.
• B)Both a share dividend and a share split reduce retained earnings.
• C)A share split increases the market value of the share.
• D)Both a share dividend and a share split increase the balance in the ordinary share account.

Grasp the effect of discount rates on present and future values.

Understand how initial deposit amounts impact future savings goals.

Analyze the impact of interest rates on investment outcomes.

Understand the principle of discounted cash flows.

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Definitions:

Willingness to Pay

Willingness to Pay is the maximum amount an individual or organization is ready to spend to procure a product or service, reflecting the value they attach to it.

Market Failure

A scenario in which the distribution of goods and services through a free market fails to be efficient, typically resulting in a decrease in overall social welfare.

Producer Surplus

The difference between what producers are willing to sell a good for and the actual price they receive, representing their gain.

Firm's Willingness

Refers to a company's readiness to engage in activities like selling at certain prices or producing specific quantities.