The Following Normal Account Balances Were Found on the General

question 11

Multiple Choice

The following normal account balances were found on the general ledger before closing entries were prepared: After closing entries are posted, what is the balance in the Capital account?

• A) $7,560
• B) $7,000
• C) $6,560
• D) Closing entries do not affect the Capital account.

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Definitions:

Marginal Utility

The additional contentment a customer derives by consuming one more unit of a product or service.

Demand

The desire and ability of consumers to purchase goods and services at various price levels.

Budget Line

A budget line represents the combination of goods and services that a consumer can purchase given their income and the prices of those goods and services.

Consumer's Equilibrium

A state where an individual allocates their income in a way that maximizes their satisfaction or utility, given their budget.