Econ202 2011 samplemidterm2 fatima 1

Earnings of companies in these fields are expected to rise, and investors start buying the common stocks of these companies before any profits are actually visible. What is meant by the concept of rotational investing? In the decline stage, the dividend may rise or fall dramatically depending upon the individual company situation.

Ceu finance faculty

The most common reason might be to indicate that the company is profitable but still needs its cash for expansion. In order to pay a dividend of common stock, the company must have positive retained earnings to transfer to the stock account. But holders of savings accounts are hurt by the increase in the inflation rate because they are taxed on their nominal interest income, so their real returns are lower. With the increase in international trade, companies are being forced to compete outside of their own geographic boundaries and this has created worldwide competition between domestic oligopolies. In general, the dividend payout ratio is non existent in the development stage and by the end of the growth stage low cash dividends may be started. How many of these ideas are likely to help poor countries grow? For a restaurant: the produce used to make salad, the things the Chef learned at Cooking School, the freezers where the steaks are kept. The most important automatic stabilizer is a. Why might a firm begin paying stock dividends in the growth stage? While the domestic market for their products is saturated international demand how allowed them to maintain double digit growth. Because of this emphasis on trading from one industry to another, a rotational investor incurs more trading costs. Earnings of companies in these fields are expected to rise, and investors start buying the common stocks of these companies before any profits are actually visible. In addition to currency, financial assets like stocks and bonds and physical assets like real estate and art make good stores of value. This would cause the supply of money to shift to the left by the same amount that the demand for money shifted, resulting in no change in the value of money and the price level.

For a restaurant: the produce used to make salad, the things the Chef learned at Cooking School, the freezers where the steaks are kept.

You are on page 1of 3 Search inside document 1. A decrease in government expenditures decreases the interest rate and so reduces investment spending.

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As the business cycle moves from a trough to a peak, different industries benefit from the economic changes that accompany the cycle. Suppose that a countrys inflation rate increases sharply.

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ECON SampleMidterm2 Fatima