A Consulting Firm Provided Services Last Month and Billed Its

question 34

Multiple Choice

A consulting firm provided services last month and billed its client.This month,the company received payment from the customer.What impact does this month's transaction have on the firm's working capital?

• A) an increase
• B) a decrease
• C) no net effect
• D) not determinable from this information

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Definitions:

Real GDP Per Person

Real GDP Per Person is a measure of the economic output of a country divided by its population, adjusted for inflation; it’s often used as an indicator of the average standard of living.

Rich Countries

Nations with high levels of income per capita, often characterized by strong economies, advanced infrastructure, and a high standard of living.

Per Capita Real Income

The average income earned per person in a given area, adjusted for inflation, reflecting the true purchasing power of the populace.

Percent Per Year

A rate that expresses the change of a quantity over one year as a percentage of the initial quantity.