Auto Workers Negotiate a Wage Increase

question 128

Multiple Choice

Auto workers negotiate a wage increase. How does this wage hike affect the supply of cars?

• A) It increases the supply.
• B) It has no effect.
• C) It decreases the supply.
• D) There is not enough information to tell if the change increases, decreases, or has no effect on the supply of cars.

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Definitions:

Retained Earnings

The cumulative net income of a company that is retained within the company for reinvestment, rather than being paid out as dividends.

Closing Entries

Journal entries made at the end of an accounting period to transfer the balances in temporary accounts to permanent accounts, preparing the books for the next period.

Zero Balance

Zero balance describes an account status in which the available balance is exactly zero, indicating no funds are currently available or outstanding.

Current Assets

Assets that are expected to be converted into cash, used, or consumed within one year or the operating cycle, whichever is longer.