A Basic Assumption of Accounting Assumes That the Dollar Is

question 62

Multiple Choice

A basic assumption of accounting assumes that the dollar is

• A) unrelated to business transactions.
• B) a poor measure of economic activities.
• C) the common unit of measure for all business transactions.
• D) useless in measuring an economic event.

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Definitions:

GDP

Gross Domestic Product, the total market value of all final goods and services produced within a country in a given period, used as a broad measure of economic performance.

Risk-Free Rate

The theoretical rate of return of an investment with zero risk, often represented by the yield on government securities such as U.S. Treasury bills.

Future Exchange Rate

The anticipated value of one currency in terms of another currency at a future date, often used in hedging and trading strategies.

Indifferent

A state of having no preference or being neutral between two or more choices in decision-making scenarios.