In 2011,the Price of Peanuts Was Rising,which Lead Peanut Butter

question 115

Multiple Choice

In 2011,the price of peanuts was rising,which lead peanut butter sellers and peanut butter buyers to expect the price of peanut butter would rise in the future.Suppose the effect on the sellers was larger than the effect on the buyers.Consequently,in the current market for peanut butter there is a ________ in the price of peanut butter and ________ in the quantity of peanut butter.

• A) rise; an increase
• B) rise; a decrease
• C) fall; a decrease
• D) fall; an increase

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Definitions:

Historical Rate

The exchange rate between two currencies at a past date, often used for comparative financial analysis or reporting purposes.

Temporal Method

An accounting method used to convert the financial statements of a foreign subsidiary to the parent company's currency, using exchange rates that change over time.

Common Stock

A form of corporate equity ownership, a type of security that represents ownership in a corporation and a claim on part of the company’s profits.

Historical Rate

A foreign exchange rate used to evaluate assets or liabilities, denoting the rate at a specific past date.