Utopia Would Be a Debtor Nation

question 112

Multiple Choice

Utopia would be a debtor nation

• A)if consumers in other countries bought goods and services from Utopia
• B)only if it had a deficit in its current account
• C)only if it had a deficit in its balance of goods and services
• D)if it had a deficit in its balance of trade
• E)if it had a deficit after adding together the balances in both its current account and its capital account

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Definitions:

Variable Costing

A costing method that includes only variable costs—costs that change with production levels—in the calculation of product costs.

Net Income

The total profit of a company after subtracting all expenses from total revenues, reflecting the company's financial performance over a given period.

Contribution Margin

The amount by which a product's sales price exceeds its total variable costs, used to cover fixed costs and generate profit.

Variable Costing

Variable costing is an accounting method that includes only variable production costs in the cost of goods sold and inventory valuation.