The Main Effect of a Decrease in the Stock of Capital

question 76

Multiple Choice

The main effect of a decrease in the stock of capital is a(n) :

• A)rightward shift of the short-run aggregate supply curve.
• B)rightward shift of the aggregate demand curve.
• C)leftward shift of the long-run aggregate supply curve.
• D)leftward shift of the aggregate demand curve.
• E)increase in the price and output levels.

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Definitions:

Job-order Costing System

A costing method that assigns costs to specific batches or lots of products, often tailor-made for customers.

Overhead Cost

Overhead cost refers to ongoing business expenses not directly tied to creating a product or service, such as rent, utilities, and insurance.

Work in Process

Represents goods that are in the process of being manufactured but are not yet complete.

Indirect Materials

Materials used in the production process that do not become an integral part of the final product and are not directly traceable to specific goods.