On the Basis of Both Theory and Empirical Evidence, Most

question 64

Multiple Choice

On the basis of both theory and empirical evidence, most economists believe that changes in fiscal policy have

• A)powerful effects on real GDP and factor prices both in the short run and in the long run.
• B)important short- run effects on real GDP and factor utilization but are less effective in changing potential GDP in the long run.
• C)no effect on factor utilization in the short run or on factor prices in the long run.
• D)long- run effects on potential GDP but have little impact on short- run real GDP.
• E)major effects on the incentive to save in the short run.

Identify procedures for handling and recording cash transactions.

Understand the concept and application of independent internal verification.

Know the significance of human resource controls in safeguarding assets.

Grasp the role of petty cash and how it is managed and recorded.

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Definitions:

Periodic Reporting

The process of preparing and presenting financial statements at regular intervals, typically quarterly or annually.

Time Period Assumption

An accounting principle that allows the business activities to be divided into artificial time periods for financial reporting.

Adjusted Trial Balance

A listing of all company accounts that will appear in the financial statements after adjustments have been made for journal entries.

Current Liability

An obligation due to be paid within a year, including accounts payable, short-term loans, and other similar debts.