Tomas Writes a Check for $1,000 Drawn on Unified Bank

question 42

Multiple Choice

Tomas writes a check for $1,000 drawn on Unified Bank and presents it to Viola. Viola presents the check for payment to Unified Bank, which dishonors it. The party most likely liable to Viola is​

• A) ​Tomas in a civil suit.
• B) ​Tomas in a criminal prosecution.
• C) ​Unity Bank in a civil suit.
• D) ​none of the choices.

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Definitions:

Cost of Equity

The rate of return that a company must offer investors to compensate for the risk of investing in its equity.

Flotation Costs

Expenses incurred by a company in issuing new securities, including underwriting, legal, and registration fees.

Dividends Low

This term implies a situation where a company issues dividends at a lower rate or amount, possibly reflecting a strategy to reinvest earnings into the business or an indication of financial conservation.

Information Content Effect

The impact of news or information release on the financial markets, especially regarding the price of securities.