The Main Effect of an Increase in Capital Stock Is

question 114

Multiple Choice

The main effect of an increase in capital stock is a(n) _____

• A) rightward shift of the long-run aggregate supply curve.
• B) rightward shift of the aggregate demand curve.
• C) leftward shift of the long-run aggregate supply curve.
• D) leftward shift of the aggregate demand curve.
• E) increase in the price and output levels.

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Definitions:

Average Cost Method

An inventory valuation method that calculates the cost of goods sold and ending inventory based on the weighted average cost of all items available for sale.

Average Cost

An inventory costing method where the cost of goods sold and ending inventory is determined by taking the weighted average of all units purchased.

Periodic Inventory

A method of inventory accounting where updates to inventory levels are made periodically, often at the end of the fiscal year.

Ending Inventory

The total value of goods available for sale at the end of an accounting period, calculated by adding purchases to beginning inventory and subtracting cost of goods sold.