Which of the Following Statements Is True

question 124

Multiple Choice

Which of the following statements is true?

• A)Keynesians believe that consumers are inherently unstable in consumption decisions,but that businesses are relatively stable in making investment decisions.
• B)Monetarists believe in discretionary monetary policy.
• C)Lowering tax rates is the main priority of supply side economists.
• D)Supply-side economists believe in a heavily regulated economy.

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Definitions:

Treasury Stock Method

A method used to compute the diluted shares outstanding by assuming all in-the-money options and warrants are exercised and the proceeds from exercise are used to buy back shares at the average market price.

Market Price

The current price at which an asset or service can be bought or sold in a open and competitive market.

Convertible Bonds

Convertible bonds are fixed-income debt securities that can be converted into a predetermined number of the issuer's equity shares at certain times during their life, usually at the discretion of the bondholder.

Diluted Earnings Per Share

A financial metric that calculates the quality of a company's earnings per share if all convertible securities were exercised.