An Improvement in the Business Outlook of Firms Is a Type

question 58

Multiple Choice

An improvement in the business outlook of firms is a type of positive _____ shock and therefore shifts the _____ curve to the _____.

• A) supply; long-run aggregate supply; right
• B) demand; aggregate demand; left
• C) supply; short-run aggregate supply; right
• D) demand; aggregate demand; right

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Definitions:

Basis

The amount of investment in property for tax purposes, used to calculate the gain or loss on the sale, exchange, or disposition of property.

Corporation

A legal entity owned by shareholders with rights and liabilities separate from those of its owners, and which pays taxes on earnings.

Fiscal Year-End

Fiscal Year-End refers to the last day of a company's accounting period, which is used for financial reporting and tax purposes and can vary but often ends on December 31.

Accrual Basis

An accounting method where income and expenses are recorded when they are earned or incurred, regardless of when the cash transaction occurs.