A Decrease in the Demand for Peanut Butter Could Be

question 128

Multiple Choice

A decrease in the demand for peanut butter could be caused by a(n)

• A)increase in the supply of peanut butter
• B)increase in the price of peanut butter
• C)doubling of the price of bread
• D)drought in Georgia that destroyed 30 percent of the peanut crop
• E)increase in consumer income

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Definitions:

Ending Inventory

The valuation of goods available for sale at the end of an accounting period; part of the calculation of cost of goods sold.

Periodic Inventory System

An inventory accounting system where updates to inventory levels are made on a periodic basis, rather than being updated continuously.

First-In, First-Out

An inventory valuation method where the goods first purchased or produced are also the first to be sold, impacting the cost of goods sold and inventory value.

Average Cost

A calculation used in finance and economics that divides the total cost of production by the number of goods produced, yielding the cost per unit.