Management May Exercise Its Judgment to Determine the Functional Currency

question 39

True/False

Management may exercise its judgment to determine the functional currency that most faithfully represents the economic effects of the underlying transactions,events and conditions.

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Definitions:

Income

Money received, especially on a regular basis, by an individual or business in exchange for providing labor, goods, or services, or through investing.

MPC (Marginal Propensity to Consume)

The proportion of an increase in income that is spent on consumption rather than being saved.

Government Purchases Multiplier

The ratio of change in aggregate economic output to a change in government spending, used to analyze the effect of fiscal policy on the economy.

Aggregate Demand

Total economic need for all goods and services within an economy, pegged at a designated price level during a chosen period.