Which of the Following Is True

question 10

Multiple Choice

Which of the following is true?

• A)A variable has a causal effect on another variable if both variables increase or decrease simultaneously.
• B)The notion of 'ceteris paribus' plays an important role in causal analysis.
• C)Difficulty in inferring causality disappears when studying data at fairly high levels of aggregation.
• D)The problem of inferring causality arises if experimental data is used for analysis.

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Definitions:

General Ledger

A comprehensive record of all financial transactions of a company, categorized into accounts.

Accounting Equation

A fundamental principle in accounting that states that assets equal liabilities plus equity (Assets = Liabilities + Equity), serving as the foundation for the balance sheet.

Current Ratio

A liquidity ratio that measures a company's ability to pay short-term obligations, calculated as current assets divided by current liabilities.

Short-term Obligations

Financial liabilities that are due for payment within one year.