Refer to the Diagram, in Which S1 and D1 Represent

question 261

Multiple Choice

Refer to the diagram, in which S1 and D1 represent the original supply and demand curves and S2 and D2 the new curves. In this market

• A) the equilibrium position has shifted from M to K.
• B) an increase in demand has been more than offset by an increase in supply.
• C) the new equilibrium price and quantity are both greater than originally.
• D) point M shows the new equilibrium position.

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Definitions:

Operating Revenues

Income generated from the core business activities of an entity excluding non-operating income sources.

Remeasurement

The process of converting foreign currency amounts into a functional currency using exchange rates that reflect changes in market conditions.

Translation

The process of converting the financial statements of a foreign subsidiary into the reporting currency of the parent company, according to appropriate accounting standards.

Purpose

The underlying motive or reason for the creation or existence of something.