A Small Italian Grocery Store Sells Five Varieties of Feta

question 334

Multiple Choice

A small Italian grocery store sells five varieties of feta cheese.It offers Bulgarian,French,Danish,Greek,and one that is processed and sold from Tillamook,Oregon.The domestic variety from Oregon) sells for $1.99/pound,while all the others sell for more than $2.99/pound,and the Greek variety is priced at $6.99/pound.The domestic variety is much cheaper because:

• A)Customers always perceive the domestic varieties to be of lower quality than the imported varieties.
• B)The value of the dollar never favors imported goods.
• C)Imported cheese producers often pay protective tariffs on these goods,which ultimately raises the price at the grocery store.
• D)The distributors of these imports refuse to buy the cheese in large enough quantities to enjoy economies of scale.

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Definitions:

Installment Note Payable

A liability representing a loan that requires regular payments or installments over a specified period until the full principal and interest are paid.

Interest Expense

The amount an entity pays over time for the use of borrowed funds.

General Journal Entry

A general journal entry is a record of financial transactions in the accounting records of a business.

Notes Payable

This refers to a written promise to pay a certain amount of money, usually including interest, by a specific date, and is recognized as a liability on a company's balance sheet.