Which of the Following Should Be Subtracted While Calculating Aggregate

question 8

Multiple Choice

Which of the following should be subtracted while calculating aggregate demand of the U.S.?

• A)Pakistan's purchase of F-16s from the U.S.
• B)Computers imported by China from the U.S.
• C)Memorabilia purchases in the U.S.by a foreign tourist.
• D)A U.S.firm's purchase of German machinery.

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Definitions:

Cost-to-Retail Ratio

A method used in retail to calculate the estimated ending inventory value at retail prices by dividing the cost of goods available for sale by the retail price of the goods.

Net Markups

The overall increase in the selling price of goods, net of any reductions or markdowns, calculated over the cost price.

Ending Inventory

The total value of all inventory in stock at the end of an accounting period, calculated using the cost of goods sold formula.

FIFO Retail Inventory Method

An inventory valuation method which assumes that items purchased or produced first are sold first, thereby computing inventory based on the most recent prices.