If the Price Level Kept Decreasing,the Short-Run Aggregate Supply Curve

question 70

Multiple Choice

If the price level kept decreasing,the short-run aggregate supply curve would get ________ because we could hire any and all resources at the going rate without increasing prices or the price of inputs.

• A)steeper
• B)flatter
• C)indefinite
• D)vertical

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Definitions:

Periodic Inventory System

A method of inventory valuation for financial accounting purposes where a physical count is performed at specific intervals to determine the ending inventory balance and the cost of goods sold.

Closing Entries

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts and prepare the company’s books for the next accounting period.

Merchandise Inventory

Goods that a company holds in stock with the intent to sell them as part of its business operations.

Purchase Discount

A reduction in the price of goods that a buyer can avail of for making early payments to the seller.