When an Economist Says That the Demand for a Product

question 35

Multiple Choice

When an economist says that the demand for a product has increased,he or she means that:

• A)consumers are now willing to purchase more of this product at every price
• B)the product has become particularly scarce for some reason
• C)the product's price has fallen and, consequently, consumers are buying a larger quantity of the product
• D)the demand curve has shifted to the left
• E)the product has suddenly become plentiful

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Definitions:

Required Return

The minimum expected return by investors for investing in a particular security or project, considering the risk involved.

Dividend

A share of profits paid by a company to its shareholders, typically on a regular basis.

ROE

Return on Equity, a measure of financial performance calculated by dividing net income by shareholders' equity, indicating how efficiently a company is using its equity to generate profits.

Dividend Growth Rate

The annualized percentage rate of growth that a particular stock's dividend undergoes over a period of time.