Describe the Concept of Flight to Quality in Terms of the Russian

question 19

Essay

Describe the concept of flight to quality in terms of the Russian government default of
August 1998.

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Definitions:

Paid-In Capital

The amount of money that a company has received from shareholders in exchange for stock, exceeding the par value of the shares.

Common Stock

A type of equity security that represents ownership in a corporation and entitles holders to vote on corporate matters and receive dividends.

Stated Value

The value assigned to no-par stock by the company's board of directors, used as the basis for accounting transactions.

No-Par

Refers to stocks issued without a par value, which means they do not have a nominal or face value.