Business Cycle flUctuations Typically Arise Because

question 137

Multiple Choice

Business cycle fluctuations typically arise because

• A) the actual supply of goods and services ends up being more or less than what consumers were expecting.
• B) the actual demand for goods and services ends up being more or less than the expected supply of goods and services.
• C) the actual demand for goods and services ends up being more or less than what firms were expecting.
• D) prices tend to be flexible in the short run.

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Definitions:

Receivables Balance

The total amount of money owed to a company by its customers for goods or services delivered or used but not yet paid for.

Accounts Receivable Turnover

This ratio measures how efficiently a company collects revenue from its customers by dividing total sales by the average accounts receivable during a specific period.

Credit Sales

Sales transactions where the payment is deferred to a future date, essentially extending credit to the purchaser.

Credit Period

The amount of time allowed by a seller for a buyer to pay for goods or services received, typically expressed in days.