When an Individual or Entity,such as a Superannuation Fund,buys Some

question 61

Multiple Choice

When an individual or entity,such as a superannuation fund,buys some shares on the stock exchange the total equity of the company in which the shares are purchased:

• A)increases
• B)remains unchanged
• C)decreases
• D)will be greater than total liabilities

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Definitions:

Negotiable

A term describing instruments or documents, such as checks or bills of lading, that are transferable from one person to another in good faith for value.

Contract Law

The area of law that governs the making, enforcement, and interpretation of agreements between parties.

Promissory Note

A financial instrument involving a written promise by one party to pay another party a definite sum of money either on demand or at a specified future date.

Credit Instrument

A document that represents a legal agreement involving any kind of financial credit or loan arrangement, including promissory notes, bonds, and letters of credit.