Figure 5.4 -Refer to Figure 5.4.The Figure Above Represents the Market for the Market

question 151

Multiple Choice

Figure 5.4
-Refer to Figure 5.4.The figure above represents the market for pecans.Assume that this is a competitive market.If the price of pecans is $3,

• A)economic surplus is maximised.
• B)not enough consumers want to buy pecans.
• C)the quantity supplied is less than the economically efficient quantity.
• D)the quantity supplied is economically efficient, but the quantity demanded is economically inefficient.

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Definitions:

Merchandise Inventory Account

An account that tracks the cost of goods held for sale during an accounting period.

Inventory Costing Methods

Refer to the approaches used by companies to assign costs to their inventory items and determine the cost of goods sold.

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue.

FIFO

Stands for "First-In, First-Out," an inventory valuation method where the first items placed in inventory are the first sold.