Which of the Following Is NOT a Short-Run

question 45

Multiple Choice

Which of the following is NOT a short-run effect of a decrease in the federal funds rate?

• A) Aggregate supply increases.
• B) Aggregate demand increases.
• C) Inflation rate increases.
• D) Net exports increase.

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Definitions:

Average Cost

A method of inventory valuation that calculates the cost of goods sold and ending inventory based on the weighted average of all units purchased.

Costing Method

a technique or methodology used to determine the cost associated with a production process or project.

LCM Approach

The Lower of Cost or Market method, an accounting principle requiring inventory to be recorded at either its historical cost or market value, whichever is lower, to reflect potential losses.