Use the Following to Answer Questions

question 25

Multiple Choice

Use the following to answer questions :
Figure 7A-2
-In Figure 7A-2 the shift in the total cost curve from AB to AC was caused by:

• A)an increase in land prices to $4.
• B)a decrease in land prices to $1.
• C)an increase in wages to $2.
• D)a decrease in wages to $2.
• E)none of the above.

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Definitions:

Conceptual Framework

An underlying structure in accounting that guides the development of standards and the preparation of financial statements.

Equity

The value of an owner's interest in a property, minus the liabilities tied to the property.

Independent

Free from external control or influence; not depending on another's authority.

Historical Cost

An accounting principle requiring assets to be recorded at their original cost at the time of purchase, without adjustments for inflation or market value changes.