Which of the Following Is True

question 31

Multiple Choice

Which of the following is true?

• A)Shareholders are entitled to be paid dividends before bondholders are paid interest.
• B)The coupon payment is the current interest rate multiplied by the face value of the bond. It is irrelevant what the interest rate was at the time the bond was issued.
• C)The coupon payment is the face value of the bond multiplied by the coupon rate.
• D)When interest rates go up, bond prices also go up.

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Definitions:

Expenditures

Payments or outlays of money to cover costs or expenses.

Salaries

Periodic payments made to employees, usually on a monthly or biweekly basis, in return for labor services performed.

Real GDP

The measure of a country's economic output adjusted for price changes, such as inflation or deflation, providing a more accurate reflection of the economy's size and how it's growing over time.

Nominal GDP

The market value of all final goods and services produced within a country in a year, measured in current prices without adjusting for inflation.