Which of the Following Policies Would Most Economists Consider the LEAST

question 61

Multiple Choice

Which of the following policies would most economists consider the LEAST desirable method to control inflation?

• A) a reduction of the rate of growth of the money supply
• B) increases in personal income tax rates
• C) an imposition of wage and price controls
• D) significant reductions in government spending levels
• E) a reduction of the size of the government budget deficit

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Definitions:

Periodic Inventory System

An inventory accounting system where inventory levels and cost of goods sold are determined at the end of an accounting period through physical counts.

Merchandise

Goods that are bought and sold in the course of business, typically in a retail or wholesale setting.

Note Payable

A written promissory note in which the borrower agrees to pay back the lender a certain amount of money at a future date or on demand.

Adjusting Entries

Entries made in the general journal at the close of an accounting period to update the ledger accounts for any income or expenses incurred but not yet recorded.