A Firm with a Stockturn Rate of 4 Sells Products

question 277

Multiple Choice

A firm with a stockturn rate of 4 sells products that cost it $100,000. This requires _____ worth of inventory.

• A) $25,000
• B) $20,000
• C) $80,000
• D) $400,000
• E) $500,000

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Definitions:

Barter

A system of exchange where goods or services are traded directly for other goods and services without the use of money.

Commodity Money

Commodity Money is a type of currency in which the value comes from a commodity of which it is made, such as gold or silver coins.

Largely Self-Sufficient

Describes an entity or community that can fulfill nearly all of its needs without external assistance.

Before Specialization

Refers to the economic state or condition prior to the allocation of resources towards the production of specific goods or services in which they have a comparative advantage.