Labor Is a Resource That Is Necessary to Produce Many

question 126

Multiple Choice

Labor is a resource that is necessary to produce many goods."If the price of labor falls," says the economist,"the prices of goods will soon follow." How does this work?

• A) If the price of labor falls,the supply of goods rises,and the prices of those goods fall.
• B) If the price of labor falls,the quantity supplied of goods rises,and the prices of those goods fall.
• C) If the price of labor falls,the demand for goods falls,and the prices of those goods fall.
• D) If the price of labor falls,the demand for goods rises,and the prices of those goods fall.
• E) If the price of labor falls,the supply of goods falls,and the prices of those goods fall.

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Definitions:

Fiscal Year

A twelve-month period used for accounting and financial reporting purposes, which may or may not align with the calendar year.

Effective Interest Rate Method

A method of amortizing the discount or premium on bonds payable that reflects the constant rate of interest over the life of the bond.

Amortization Schedule

An Amortization Schedule is a table detailing each periodic payment on an amortizing loan, including the amount of principal and the amount of interest that comprises each payment until the loan is paid off at the end of its term.

Bond Carrying Amount

The net value of a bond on a balance sheet, which may differ from its face value due to amortization or market changes.