Which of the Following Is Not an Effect That Occurs

question 298

Multiple Choice

Which of the following is not an effect that occurs when the general price level in our economy increases?

• A) The purchasing power of people's savings will increase.
• B) The interest rate will also tend to increase.
• C) Foreign buyers will buy less of our output, and we tend to import more.
• D) Our net exports will tend to decrease.

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Definitions:

Periodic Inventory System

An inventory system where the inventory count is updated and cost of goods sold is calculated at specific intervals, not continuously.

Purchase Returns and Allowances

Concessions granted by sellers to buyers, involving the return of goods or issuance of allowances for unsatisfactory products or services.

Purchase Discounts

Reductions in the price of goods that a buyer is entitled to for early payment or volume purchases.

Freight-In

Costs associated with bringing inventory to a business location, typically included in the inventory cost.