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Consider the following statements:
a. Car owners purchase more gasoline from a gas station that sells gasoline at a lower price than other rival gas stations in the area.
b. Banks do not take steps to increase security since they believe it is less costly to allow some bank robberies than to install expensive security monitoring equipment.
c. Firms produce more of a particular DVD when its selling price rises.
Which of the above statements demonstrates that economic agents respond to incentives?
Closing Entries
Journal entries made at the end of an accounting period to transfer the balances of temporary accounts to permanent ones.
Retained Earnings Account
An equity account that represents the accumulated portion of net income that a company retains after distributing dividends to shareholders.
Balance Sheet Accounts
Categories in a balance sheet including assets, liabilities, and shareholders' equity, representing a company's financial position.
Real Accounts
Accounts that are not closed at the end of the accounting period, representing ongoing financial balances in assets, liabilities, and equity.
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