Suppose You Are Deciding Whether to Spend Your Tax Rebate

question 36

Multiple Choice

Suppose you are deciding whether to spend your tax rebate check on a new iPod or a new digital camera. You are dealing with the concept of

• A) equity.
• B) comparative advantage.
• C) opportunity costs.
• D) the fallacy of composition.

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Definitions:

Finished Goods Inventory

The value of products that have completed the manufacturing process but have not yet been sold to customers.

Raw Materials Inventory

An account on the balance sheet that represents the cost of materials that have not yet been converted into finished products by a manufacturing company.

Finished Goods Inventory

The stock of final products that are ready to be sold but have not yet been sold to customers.

Cost Of Goods Manufactured

The total production cost of goods completed during a specific period, whether they are sold or not.