Economic Profit Affects

question 140

Multiple Choice

Economic profit affects

• A)the allocation of resources but not the level of resource use.
• B)the level of resource use but not the allocation of resources.
• C)the allocation of resources and the level of resource use.
• D)neither the allocation of resources nor the level of resource use.

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Definitions:

Net Purchases

Net purchases are the total amount of purchases made by a business after subtracting returns, allowances, and discounts.

Cash Conversion Cycle

A measurement that calculates the duration required for a business to transform its inventory investments and additional resources into cash flows resulting from sales.

Accounts Receivable

Money owed to a business by its customers for goods or services provided on credit.

Accounts Payable

Accounts payable are amounts a company owes to suppliers for items or services purchased on credit; it is a current liability on the balance sheet.