Beyond any mortgage thereon and liability therein, the residual value of a business or property is called equity. Which of the following are also included by term equity ?
Correct answer: C. Both of them
- A. The market value of securities less any debt incurred and common stock and preferred stock
- B. Funds provided to a business by the sale of stock
- C. Both of them
- D. None of them
Explanation
Equity represents the owners' residual interest after liabilities are deducted from asset value, and it can be raised through the sale of common or preferred stock. Both statements describe equity or equity capital.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Microeconomics
Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
Practise Microeconomics
1,742 free Microeconomics MCQs from Economics, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Economics questions like this
Economics is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Microeconomics questions
Free port is ?
Term the interchange of commodities across political frontiers without restriction such as tariffs, quotas, or foreign exchange controls ?
There are certain products which are sold without brand name or trademark What these products are called ?
How is termed the government's order to prevent the arrival or departure of merchant ships or to restrict import or export of specified or all goods with a foreign nation ?
Term the shared of profits of a joint stock company ?
The sole legal right to print or publish anything which belongs to the author or his assignees is called ?