Refer to the Graph Below

question 126

Multiple Choice

Refer to the graph below. The movement from point 1 to point 2 is stimulated by a disequilibrium in which there is domestic ________ and ________.

• A) overemployment; trade surplus
• B) unemployment; trade surplus
• C) overemployment; trade deficit
• D) unemployment; trade deficit
• E) inflation; unemployment

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Definitions:

First-In, First-Out Method

This is an inventory valuation method where goods first added to inventory are the first ones to be sold.

Equivalent Units

A concept used in cost accounting to assign costs to partially completed goods, expressed in terms of fully completed units.

Conversion Costs

The sum of direct labor and manufacturing overhead expenses involved in turning raw materials into completed goods.

Direct Method

A cash flow statement preparation method that lists major categories of gross cash receipts and payments, directly showing sources and uses of cash.