In Zimbabwe, Price Increases of 150,000 Percent Per Year Were

question 28

Multiple Choice

In Zimbabwe, price increases of 150,000 percent per year were caused by:

• A) the country's unsustainable trade deficit.
• B) marginal tax rates as high as 90 percent.
• C) large increases in the money supply.
• D) deregulated prices.

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Definitions:

Investment

The action of deploying resources (such as capital) with the expectation of generating an income or profit.

Cost Method

is an accounting approach used for recording investments, where the investment is recorded at its acquisition cost and adjustments are made for dividends or interest earned and changes in value are not recognized until sold.

Trading Securities

Trading securities are investments in debt or equity that are purchased with the intention of selling them in the near term to realize short-term gains.

Comprehensive Income

The change in equity (net assets) of a business enterprise during a period from transactions and other events from non-owner sources. It includes all revenues, gains, expenses, and losses.