The fact that common stockholders are residual claimants means the stockholders:
A. receive their dividends before any other residuals are paid.
B. have a claim against the revenue that remains after everyone else is paid.
C. are paid any past due dividends before other claims are paid.
D. are paid before the bondholders but after any taxes are paid.
Answer: B
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If the world price for good A is above the domestic price for good A without trade, then consumer surplus will ________ and total economic surplus will ________ with trade.
A. increase; decrease B. decrease; increase C. decrease; decrease D. increase; increase
Refer to Figure 12-7. If the market price is P2 the firm
A) will make a profit and produce a quantity of Q2. B) will break even and produce a quantity of Q2. C) will make a profit and produce a quantity of Q1. D) will make a profit and produce a quantity of Q3.
Maryanne expects to work for another 30 years and expects to live another 10 years after she retires. If Maryanne completely smooths consumption over her lifetime, her marginal propensity to consume out of wealth is
A) 0.025. B) 0.033. C) 0.075. D) 0.10.
Moving from the late 1960s to 1970-1973,
a. inflation remained high while the unemployment rate was lower than in the late 1960s. b. inflation remained high while the unemployment rate was higher than in the late 1960s. c. inflation remained low while the unemployment rate was lower than in the late 1960s. d. inflation remained low while the unemployment rate was higher than in the late 1960s.