Which of the Following Is Not True Regarding Shareholders' Equity

question 110

Multiple Choice

Which of the following is not true regarding shareholders' equity for a corporation?

• A)Shareholders' equity is the residual interest of owners in the assets of an entity, after subtracting liabilities.
• B)Shareholders' equity includes assets exchanged by owners in return for an ownership interest.
• C)Shareholders' equity includes net assets generated by earnings activities in excess of net assets distributed to owners as dividends.
• D)Shareholders' equity is increased by repurchases by the firm of its ownership interests.
• E)all of the above.

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Definitions:

Demand Curve

A graph showing the relationship between the price of a good and the quantity of the good that consumers are willing to purchase at various prices.

Elastic

Describes a situation in which the quantity demanded or supplied of a good or service is significantly affected by changes in its price.

Pure Monopolist's Demand Curve

A graphical representation showing how a monopolist's quantity sold varies with price, typically downward sloping, reflecting that the monopolist can set prices above marginal costs.

Elastic

A characteristic of a good or service indicating that its demand or supply is sensitive to changes in price.