What would happen if a corporation goes out of business?
What will be an ideal response?
The assets of the corporation would be sold and the bondholders would receive the funds due them. Any funds left over would be divided among the shareholders. Firms must pay their obligations to bondholders before stockholders get money.
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If the dollar falls in value compared to other currencies, what will happen in the United States?
A. A decrease in aggregate demand B. An increase in aggregate supply C. A decrease in aggregate supply D. A decrease in the U.S. price level
If a Lorenz curve for a country's income bows more rightward over time, then the country's
A) income is increasing. B) income is decreasing. C) income is becoming more unequally distributed. D) income is becoming more equally distributed.
Refer to Figure 5-1. Marginal social benefit is represented by which curve?
A) Supply B) D1 C) D2 D) All of the above represent marginal social benefit.
Suppose the currency price of the U.S. dollar in terms of the Japanese yen starts to fall. To prevent that from occurring, the U.S. central bank should
A) use U.S. dollars to buy Japanese goods. B) use yen reserves to buy U.S. dollars in the foreign exchange market. C) sell U.S. dollars in the foreign exchange market in exchange for yen. D) buy both U.S. dollars and yen in the foreign exchange market.