Which of the Following Is Considered a Negative Supply Shock

question 215

Multiple Choice

Which of the following is considered a negative supply shock?

• A)increasing investment in the economy causes the capital stock to rise
• B)an unexpected increase in the price of natural gas
• C)a decline in wages
• D)an improvement in technology
• E)a drop in investment spending

---

Definitions:

Merchandise Sale

The process of selling goods that are purchased for resale, constituting a primary revenue source for retail businesses.

Allowance Method

A method in accounting for managing bad debts by predicting the accounts that cannot be collected at the end of every period.

Direct Write-off Method

An accounting method for recognizing bad debts where the specific uncollectible accounts receivable are written off as they are identified.

Uncollectible Accounts Receivables

Accounts receivable that a company does not expect to collect and must write off as a loss because the debtor is unable to pay the owed amount.