If the Price Level in the Current Period Is Higher

question 60

Multiple Choice

If the price level in the current period is higher than what buyers and sellers anticipated,

• A) profit margins will be unattractive and firms will expand output.
• B) profit margins will be unattractive and firms will reduce output.
• C) profit margins will be attractive and firms will expand output.
• D) profit margins will be attractive and firms will reduce output.

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Definitions:

Payables Period

The length of time a company takes to pay its invoices to suppliers, reflecting its payment policy's efficiency.

Accounts Receivable Balance

The sum total of debts customers have towards a company for delivered goods or services which have not been paid for yet.

Wholesale Cost

The price charged for a product by the wholesaler, which is typically lower than the retail price.

Accounts Payable Balance

The total amount of money a company owes to its suppliers or creditors at a given point in time.