Figure 12-2 -Refer to Figure 12-2.If the U.S.economy Is Currently at Point

question 193

Multiple Choice

Figure 12-2
-Refer to Figure 12-2.If the U.S.economy is currently at point N,which of the following could cause it to move to point K?

• A)Households expect future income to rise.
• B)Household wealth falls.
• C)The firm's cash flow rises as profits rise.
• D)Government expenditures increase.

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Definitions:

Fixed Costs

Expenses that do not change with the level of goods or services produced by a business, such as rent, salaries, and insurance premiums.

Inventory Management

Inventory management involves overseeing and controlling the ordering, storing, and use of components that a company will use in the production of the items it will sell as well as the managing of quantities of finished products.

Collection Policy

Procedures followed by a firm in collecting accounts receivable.

Accounts Receivable

Money owed to a company by its customers for products or services that have been delivered but not yet paid for.