Which of the Following Is Correct

question 191

Multiple Choice

Which of the following is correct?

• A)If the Fed purchases bonds in the open market,then the money supply curve shifts right.A change in the price level does not shift the money supply curve.
• B)If the Fed sells bonds in the open market,then the money supply curve shifts right.A change in the price level does not shift the money supply curve.
• C)If the Fed purchases bonds,then the money supply curve shifts right.An increase in the price level shifts the money supply curve right.
• D)If the Fed sells bonds,then the money supply curve shifts right.A decrease in the price level shifts the money supply curve right.

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Definitions:

Carrying Amount

The recorded cost of an asset in a company's financial statements, less any accumulated depreciation or amortization.

Allowance for Doubtful Accounts

A contra-asset account used to reduce accounts receivable to its net realizable value by estimating uncollectible debts.

Bad Debts Expense

An expense recognized when it is probable that receivables will not be collected and is considered a cost of doing business on credit.

Allowance for Doubtful Accounts

A contra asset account that represents estimated uncollectible amounts from customers, reducing the gross receivables to their net realizable value.