A Company Reports the Following in Relation to Its Latest $$\begin{array} { l l } \text { Net profit } & \$ 12000 \\\text { Number of ordinary shares issued } & 5000\end{array}$$

question 19

Multiple Choice

A company reports the following in relation to its latest financial year:
$$\begin{array} { l l } \text { Net profit } & \$ 12000 \\\text { Number of ordinary shares issued } & 5000\end{array}$$
Number of preference shares issued
$$\text { \{paying an annual dividend of } 50 \text { cents per share\} }$$
The company's basic earnings per share figure is:

• A) $2.00
• B) $2.20
• C) $2.10
• D) $2.35

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Definitions:

Crowding Out

The phenomenon where increased government spending leads to a reduction in private sector investment or spending due to higher interest rates or competition for resources.

Discretionary Fiscal Policy

It involves government policy changes in taxation and spending designed to influence economic activity, typically to counteract inflation or deflation and stabilize the economy.

Nominal Output

The total value of goods and services produced by an economy, measured in current prices without adjusting for inflation.

Interest Rate

The cost of borrowing money, typically expressed as a percentage of the amount borrowed.