Holding Supply Constant, a Reduction in Demand Leads to

question 162

Multiple Choice

Holding supply constant, a reduction in demand leads to

• A) lower prices and higher quantity supplied.
• B) lower prices and lower quantity supplied.
• C) higher prices and higher quantity supplied.
• D) higher prices and lower quantity supplied.

---

Definitions:

Common Stock

Equity ownership in a corporation, with voting rights and the potential to receive dividends.

Cash Dividend

A payment made by a company to its shareholders, usually as a distribution of profits.

Journal Entry

A record in the books of accounts that represents a business transaction, including the accounts and amounts to be debited and credited.

Dividend Yield Ratio

A business ratio reflecting the amount a firm disburses in dividends annually compared to the price of its shares.