Leading Economic Indicators Suggest That Incomes Will Be Going Up

question 91

Multiple Choice

Leading economic indicators suggest that incomes will be going up next year.In response to these reports,companies are forecasting increased prices for future sales of their goods.As a result of these increases,the supply curve will

• A) shift to the right,causing the equilibrium price to decrease.
• B) remain the same,but the equilibrium price will increase.
• C) remain the same,but the equilibrium price will decrease.
• D) shift to the right,causing the equilibrium price to increase.
• E) shift to the left,causing the equilibrium price to increase.

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Definitions:

Revenue Recognition

The accounting principle that determines the specific conditions under which income becomes realized as revenue.

Feedback Value

The information obtained from assessing a decision or process that is used to make improvements or adjustments.

Relevance

A characteristic of financial information that is capable of making a difference in the decisions made by users.

Decision Usefulness

The quality of financial information that helps users make informed decisions regarding investment, credit, and similar activities.