Graph 11-1 -When the Money Supply Curve in Graph11-1 Shifts from MS₂

question 54

Multiple Choice

Graph 11-1
-When the money supply curve in Graph11-1 shifts from MS₂ to MS₁:

• A)the equilibrium price level increases
• B)this may be due to the RBA selling government securities
• C)this is due to the RBA buying government securities
• D)the demand for goods and services increasing

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Definitions:

Stockholders' Equity

Stockholders' Equity is the residual interest in the assets of a corporation that remains after deducting its liabilities, representing ownership interest in a company.

Net Income

The total earnings or profit of a company after deducting all expenses, taxes, and losses from the total revenue.

Retained Earnings

The portion of net income that is retained by the company rather than distributed to its shareholders as dividends.

Cash Dividend

A payment made by a corporation to its shareholders, usually as a distribution of profits in the form of cash.