A Small Reduction in a Country's Growth Rate Is a Concern

question 12

Multiple Choice

A small reduction in a country's growth rate is a concern to policy makers because

• A) a small change can have large effects on per capita GDP over time.
• B) a reduction usually leads to future reductions until finally the economy stagnates.
• C) policy makers focus too much on economic growth and not enough on increasing savings rates.
• D) the larger GDP is the better the economic welfare will be in the future.

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Definitions:

Inventory Holding Gains

Gains resulting from an increase in the value of inventory that a company holds over a period.

Consignment

The process of placing goods with a third party who has the authority to sell the goods on behalf of the owner, but the ownership of the goods remains with the consignor until sold.

Inventory Valuation

A method used to assess the cost or market value of inventories a company holds at the end of a period.

Inventory Accounting

The method of accounting that focuses on the valuation, recording, and management of inventory, including the cost of goods sold.