(Table) Suppose a Loaf of Bread Goes Through the Following

question 166

Multiple Choice

(Table) Suppose a loaf of bread goes through the following stages of production, with the values noted at the end of each stage. The sale of one loaf of bread adds _____ to GDP.

• A) $4.45
• B) $5.65
• C) $2.65
• D) $6.30

---

Definitions:

Inventory Turnover

A ratio indicating how many times a company’s inventory is sold and replaced over a specific period.

ACP

Average Collection Period, indicating the average number of days it takes for a company to collect its receivables.

Pledging Receivables

Pledging receivables involves using the money owed to a company by its customers as collateral for a loan.

Effective Cost

Effective cost refers to the total cost of a financing option when all charges, fees, and interest payments are taken into account.