If the Economy Experiences a Strong Boom and Consumers' Incomes

question 78

Multiple Choice

If the economy experiences a strong boom and consumers' incomes sharply rise, local stores with higher prices are to have a(n) in the number of customers.

• A)likely; increase
• B)likely; decrease
• C)not likely; change
• D)not likely; increase

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Definitions:

Original Principal

The initial amount of debt or loan before any interest or fees are added; it is the base amount on which interest calculations are made.

Accrued Interest

Interest earned or owed that has not yet been paid or received.

Discounting

The process of determining the present value of a future amount of money or stream of cash flows given a specific rate.

Present Dollar

Present Dollar refers to the value of a sum of money in terms of its purchasing power at the current period, not adjusted for inflation or deflation over time.