The Product Is a Normal Product

question 118

Multiple Choice

The product is a normal product.

-What is the effect of a decrease in the supply of a product?

• A)It will cause an increase in both the price and in the quantity traded.
• B)It will cause an increase in the price but a decrease in the quantity traded.
• C)It will cause a decrease in both the price and in the quantity traded.
• D)It will cause a decrease in the price but an increase in the quantity traded.

---

Definitions:

Inventory Costing

The method used to value and account for inventory, including costs of purchase, production, and conversion.

Ending Inventory

The total value of goods available for sale at the end of an accounting period, calculated after considering the cost of goods sold and any new purchases.

Inventory Management

The process of ordering, storing, using, and selling a company's inventory. This includes the management of raw materials, components, and finished products, as well as warehousing and processing such items.

Days' Sales

A measure that indicates how many days, on average, it takes a company to collect revenue after a sale has been made.