For the Following Questions,use the Diagram Below

question 87

Multiple Choice

For the following questions,use the diagram below:
Figure 34-6.
-Refer to Figure 34-6.Which of the following is correct?

• A) A wave of optimism could move the economy from point a to point
• B) If aggregate demand moves from AD₁ to AD₂,the economy will stay at point b in both the short run and long run.
• C) It is possible that either fiscal or monetary policy might have caused the shift from AD₁ to AD₂.
• D) All of the above are correct.

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Definitions:

Closing Entries

Closing entries are journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts, preparing the books for the next period.

Closing Entry

A journal entry made at the end of an accounting period to transfer temporary account balances to permanent accounts.

Revenue Accounts

Revenue accounts are those used in accounting to track the income generated by a business from its normal operations.

Income Summary

An account used in closing entries to summarize revenues and expenses for a specific accounting period before transferring the net income to retained earnings.