The Evolution of Macroeconomic Theory

question 21

Multiple Choice

The evolution of macroeconomic theory

• A)usually precedes and causes major macroeconomic events.
• B)usually is in reaction to major macroeconomic events.
• C)is evenly divided between causing and reacting to major macroeconomic events.
• D)proceeds rather independently of major macroeconomic events.

---

Definitions:

Ending Inventory

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

Net Income

The final profit figure for a company, arrived at by removing all expenses and tax payments from its revenue.

Increasing Costs

A situation where production or operating expenses grow over time, often due to inflation, increased demand for resources, or higher labor costs.

LIFO Inventory Cost Method

An inventory valuation method that assumes the last items purchased are the first ones sold, affecting the company's bookkeeping and tax calculations.