-Refer to Figure 15-5

question 17

Multiple Choice

-Refer to Figure 15-5.Assuming that the economy starts at point X,a decrease in world oil prices would

• A) move the economy to point A
• B) move the economy to point B
• C) shift the aggregate supply curve upward to curve E
• D) shift the aggregate supply curve downward to curve F
• E) have no impact since the model only shows the relationship between the overall price level and real GDP.

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Definitions:

Accounts Receivable Period

The Accounts Receivable Period is the average number of days it takes for a business to receive payments from its customers for goods or services sold on credit.

Accounts Receivable

Receivables from customers for goods or services provided but not yet compensated.

Effective Annual Interest Rate

The interest rate on a loan or financial product restated from the nominal rate as an annual rate that reflects compounding over a given period.

Cash Cycle

The period of time it takes for a company to convert its investments in inventory and resources into cash flows from sales.