Figure 21-22 -Refer to Figure 21-22.When the Price of X Is $80,the

question 299

Multiple Choice

Figure 21-22

-Refer to Figure 21-22.When the price of X is $80,the price of Y is $20,and the consumer's income is $160,the consumer's optimal choice is D.Then the price of X decreases to $20.The substitution effect can be illustrated as the movement from

• A) D to E.
• B) D to C.
• C) C to E.
• D) E to D.

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Definitions:

NPV Projects

Projects that are evaluated based on their Net Present Value, which calculates the difference between the present value of cash inflows and outflows over a period of time.

Dividend Income

is money paid to shareholders out of a corporation's earnings in proportion to the number of shares held, usually on a regular basis.

Stock Repurchase

A transaction where a corporation repurchases its shares from the market, thereby decreasing the volume of shares that are publicly available.

Repurchase

A company's practice of reacquiring its shares from the market, which may lead to an appreciation in the value of the outstanding shares.