With Respect to the Balance Sheet, an Increase in Equity

question 7

Multiple Choice

With respect to the balance sheet, an increase in equity of $2,000 with an increase in net income to $2,500, leads us to believe:

• A)The firm paid a dividend of $500
• B)The firm plowed $500 back into the company
• C)$500 went into retained earning
• D)Debt increased by $2,000

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Definitions:

Competition

The rivalry among sellers in the market striving for a greater share of profits by offering the best possible terms to consumers.

New Products

Goods, services, or technologies that have been recently developed and introduced to the market.

Long-Run Supply Curve

A graphical representation showing the relationship between the price of a good and the total output produced by firms in the market over a long period, assuming input factors are variable.