Many States Have Laws That Limit the Maximum Amount of Interest

question 16

Multiple Choice

Many states have laws that limit the maximum amount of interest that a lender can charge a borrower.Such a law is an example of a(n)

• A) equilibrium price.
• B) price ceiling.
• C) price floor.
• D) black market price.
• E) ration price.

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Definitions:

Date of Record

The specified date when a company determines the owners of its stock to be eligible for a forthcoming dividend or corporate action.

Stock Split

A corporate action that increases the number of shares in a company by issuing more shares to current shareholders, thereby reducing the price per share, without changing the shareholders' equity.

Common Stock Account

An equity account that represents ownership in a corporation and entitles holders to voting rights and dividends.

Retained Earnings Account

An equity account on a company’s balance sheet that represents the accumulated portion of earnings not distributed to shareholders as dividends.