Other Things Equal, an Increase of Corporate Bonds from $140

question 252

Multiple Choice

$$\begin{array} { | l | c | } \hline \text { Security } & \text { Amount (in Billions) } \\\hline \text { Treasury Bills } & \$ 220 \\\hline \text { Corporate Bonds } & 140 \\\hline \text { Treasury Notes } & 80 \\\hline \text { Corporate Stock } & 200 \\\hline \text { US Savings Bonds } & 60 \\\hline \text { Treasury Bonds } & 100 \\\hline\end{array}$$ Other things equal, an increase of corporate bonds from $140 billion to $150 billion in the economy would

• A) not change the size of the public debt.
• B) increase the public debt from $460 billion to $470 billion.
• C) increase the public debt from $600 billion to $610 billion.
• D) decrease the public debt by $20 billion.

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Definitions:

Equivalent Units

A concept used in cost accounting to express the amount of work done by manufacturers in terms of fully completed units.

Materials

Items or supplies used in the production of goods, considered part of the direct costs in manufacturing.

FIFO Method

"First In, First Out," an inventory valuation method that assumes goods are sold in the order they are acquired, impacting the cost of goods sold and inventory value.

Equivalent Units

A term used in process costing to measure the amount of work done on incomplete products, converted into an equivalent number of fully completed units.