A Stock That Follows the Business Cycle of Advances and Declines

question 6

Multiple Choice

A stock that follows the business cycle of advances and declines in the economy is called a(n) ____________ stock.

• A) defensive
• B) cyclical
• C) growth
• D) income
• E) blue-chip

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Definitions:

Closing Inventory

The total value of goods remaining unsold at the end of an accounting period.

Finished Goods

Products that have completed the manufacturing process but have not yet been sold or distributed to end customers.

Standard Costs

Predetermined or budgeted costs for products, services, or operations that serve as benchmarks for measuring performance by comparing them with actual costs.

Normal Absorption Costing

A method of product costing that assigns all manufacturing costs to products, including both variable and fixed overhead, based on a normal level of operation.