Which of the Following Accounts Are Included in Shareholders' Equity

question 35

Multiple Choice

Which of the following accounts are included in shareholders' equity?
I. interest paid
II. retained earnings
III. capital surplus
IV. long-term debt

• A) I and II only
• B) II and IV only
• C) I and IV only
• D) II and III only
• E) I and III only

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Definitions:

Modified Duration

A measure of the sensitivity of a bond's price to changes in interest rates, indicating the price change in percentage terms for a yield move of one percent.

Macaulay Duration

A measure of the weighted average time until a bond's cash flows are paid back, used to assess interest rate risk.

Yield To Maturity

The total return anticipated on a bond if held until it matures.

Interest-Rate Risk

The risk that an investment's value will change due to a change in the absolute level of interest rates, affecting debt securities inversely with respect to their prices and yields.