A Debt That a Business Owes to an Outside Party

question 135

Multiple Choice

A debt that a business owes to an outside party is called:

• A)an asset.
• B)a liability.
• C)stockholders' equity.
• D)revenue.

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Definitions:

Efficiency Wage Theory

Explanation for the presence of unemployment and wage discrimination which recognizes that labor productivity may be affected by the wage rate.

Productivity

The measure of the efficiency of production, often quantified as output per unit of input.

Wages

Wages are the payments made to labor for their services, typically calculated on an hourly, daily, or piecework basis, and are a primary form of income for employees.

Rules of Thumb

General principles that provide practical instructions or guidelines, typically based on experience rather than theory.