According to Say's Law, There Cannot Be Overproduction of Goods

question 4

Multiple Choice

According to Say's law, there cannot be overproduction of goods and services because:

• A) planned aggregate expenditures sometimes fall short of total output.
• B) prices and wages are "sticky" or inflexible in the downward direction.
• C) demand creates its own supply.
• D) supply creates its own demand.

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Definitions:

Target Costing

An accounting strategy that sets prices based on market conditions and then manages costs to meet those prices, aiming for profitability.

Target Selling Price

The price a company aims to sell its product for, determined by market conditions, cost structure, and profit margin goals.

New Product

A good or service that has recently been developed and introduced to the market, offering new features, benefits, or improvements over previous versions.

Target Cost

The maximum amount that can be spent on a product while still earning the required profit margin, based on market-driven pricing.