Which of the Following Is Likely to Be an Effect

question 73

Multiple Choice

Which of the following is likely to be an effect of inflation?

• A)An increase in the willingness of lenders to lend money for longer periods
• B)A decrease in the willingness of borrowers to borrow money for longer periods
• C)A decrease in the purchasing power of lenders in the economy
• D)An increase in the willingness of people to buy bonds as a hedge against rising prices
• E)An increase in the willingness of people to buy physical assets as a hedge against rising prices

Grasp the concept of budgeted cash collections and their calculation.

Comprehend the preparation and importance of a direct materials purchases budget.

Understand how to prepare and analyze a sales budget.

Gain insights into the preparation of a cash budget and its components.

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Definitions:

Opportunity Cost

The opportunity cost of an alternative is the profit you give up to pursue it.

Interest Payments

The amount paid by a borrower to a lender as compensation for the use of borrowed funds, usually calculated as a percentage of the principal amount.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision, representing the benefits that could have been received but were given up.

Explicit Cost

Direct, out-of-pocket payments for resources employed in the production of goods or services.