An Increase in the Number of Authorized, Issued and Outstanding

question 28

Multiple Choice

An increase in the number of authorized, issued and outstanding shares of stock along with a proportional reduction in the stock's par value is a:

• A) deficit.
• B) stock dividend.
• C) stock split.
• D) cash dividend.

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Definitions:

Unit Elastic

A situation in which the percentage change in quantity demanded is equal to the percentage change in price, leading to a unitary elasticity of demand.

Elastic Portion

The segment of a demand curve where a change in price leads to a more than proportional change in the quantity demanded, indicating high price sensitivity.

Linear Demand

A type of demand where there is a constant relationship between the quantity demanded and price, represented by a straight line on a graph.

Price Inelastic

A situation in which the demand for a good does not change significantly in response to a change in price, indicating that consumers are less sensitive to price changes.