Which of the Following Statements Is Correct

question 8

Multiple Choice

Which of the following statements is correct?

• A) Interest paid is an inflow of cash
• B) Taxation paid is an inflow of cash
• C) Decrease in trade payables is an outflow of cash
• D) A reduction in inventory is treated as an inflow of cash

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Definitions:

Normal Goods

Goods for which demand increases as the income of consumers increases, and decreases when consumer income decreases, holding all other factors constant.

Inferior Goods

Goods for which demand decreases as the income of the consumer increases, opposite to normal goods.

Demand Curve

An image that depicts how the price level of a good or service influences its required quantity within a designated period.

Number of Buyers

The total quantity of individuals or entities in a market that are potential or actual purchasers of goods and services.