An Unexpected Reduction in the Money Supply Will Tend to Cause

question 2

Multiple Choice

An unexpected reduction in the money supply will tend to cause

• A)an increase in stock prices.
• B)a reduction in stock prices.
• C)no change in stock prices.
• D)an ambiguous effect on stock prices.

---

Definitions:

Periodic Inventory System

An inventory system that updates inventory records and calculates cost of goods sold at the end of a reporting period, rather than continuously.

LIFO

Last In, First Out refers to an approach for evaluating inventory in which the items that were produced last are considered to be the first ones sold.

Weighted-Average Cost

A calculation used in inventory management and cost accounting that takes into account the varying costs of goods and determines an average cost for the goods sold.

Periodic Inventory System

An inventory system that updates inventory balances after a specific period, calculating COGS by a physical count.