Moving Along a Given Budget Line

question 441

Multiple Choice

Moving along a given budget line

• A) prices and real income both decrease.
• B) prices fall and real income is constant.
• C) real income decreases and prices are constant.
• D) prices and real income are constant.

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Definitions:

Preferred Stock

Nonvoting shares in a corporation, paying a fixed or variable stream of dividends.

Cumulative Dividends

Dividends that are owed to preferred shareholders of a company and must be paid out before dividends can be distributed to common shareholders.

Voting Power

Voting power refers to the number of votes a shareholder has in a company's decisions, typically based on the number of shares held.

Marginal Tax Bracket

The rate at which the last dollar of a taxpayer's income is taxed, indicating the tax rate applied to their highest portion of income.