Table 4-1 -Refer to Table 4-1.The Table Above Lists the Highest Prices

question 168

Multiple Choice

Table 4-1

-Refer to Table 4-1.The table above lists the highest prices three consumers, Tom, Dick, and Harriet, are willing to pay for a short-sleeved polo shirt.If the price of one of the shirts is $28 dollars,

• A)Tom will buy two shirts, Dick will buy one shirt and Harriet will buy no shirts.
• B)Tom will receive $12 of consumer surplus from buying one shirt.
• C)Tom and Dick receive a total of $70 of consumer surplus from buying one shirt each. Harriet will buy no shirts.
• D)Harriet will receive $25 of consumer surplus since she will buy no shirts.

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Definitions:

Stockholders' Equity

Represents the ownership interest of shareholders in the corporation, calculated as total assets minus total liabilities.

Noncumulative Preferred Stock

A type of preferred stock where dividend payments are not required to be paid in periods when they are not declared.

Dividends Received

The payments a shareholder receives from a company out of its profits or reserves as a return on the shareholder's investment.

Par Value

The face value of a bond or stock as stated by the issuing company, not necessarily its market value.