If the Base Year for the GDP Deflator Is 2000

question 223

Multiple Choice

If the base year for the GDP deflator is 2000 and the value of the GDP deflator in 2003 was 107,this indicates that the general level of prices

• A)declined between 2000 and 2003.
• B)was approximately 7 percent lower in 2003 than in 2000.
• C)was approximately 7 percent higher in 2003 than in 2000.
• D)was approximately 107 percent higher in 2003 than in 2000.

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Definitions:

Sales On Account

Transactions where goods or services are sold to a customer with an agreement that payment will be made at a later date.

Cost Of Goods Sold

The total cost directly associated with the production of the goods sold by a company.

Times Interest Earned

A ratio that measures a company's ability to meet its interest obligations, calculated by dividing earnings before interest and taxes (EBIT) by the interest expense.

Financial Statements

Formal records of the financial activities and position of a business, person, or other entity.