Starting from a Trade Surplus, What Would Create a Trade

question 72

Multiple Choice

Starting from a trade surplus, what would create a trade deficit?

• A) a decline in saving and investment
• B) a rise in saving and investment
• C) a decline in saving and a rise in investment
• D) a rise in saving and a decline in investment

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Definitions:

Automatic Dividend Reinvestment

A program that allows investors to reinvest their cash dividends in additional shares or fractional shares of the underlying stock automatically.

Corporate Dividend Policies

Strategies a corporation adopts to decide the size, timing, and payment methods of dividends to shareholders.

Individual Stockholders

Private individuals who own shares in a corporation, thus holding a portion of the company's equity and potentially entitled to dividends.

Flotation Costs

The costs associated with the issuance of new securities.