Exhibit 4-2 -Refer to Exhibit 4-2. If the Supply Curve Shifts to Curve

question 60

Multiple Choice

Exhibit 4-2
-Refer to Exhibit 4-2. If the supply curve shifts to the right, then which of the following is true?

• A)D₁ results in the most decrease in the equilibrium price.
• B)D₁ results in the most increase in the equilibrium price.
• C)D₂ results in the most decrease in the equilibrium price.
• D)D₂ results in the most increase in the equilibrium price.
• E)The change in the equilibrium price is the same for D₁ and D_2.

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Definitions:

Net Income

The total earnings of a company after subtracting all expenses from revenues.

Common Stock

A form of corporate equity ownership, a type of security representing ownership in a corporation and a claim on part of the corporation's assets and earnings.

Declaration Date

The specific date on which a company's board of directors announces the issuance of a dividend to shareholders.

Common Stock

Represents ownership interests in a corporation, giving holders voting rights and a share in the company's profitability through dividends.