When a Shortage Exists

question 129

Multiple Choice

When a shortage exists

• A)the price is below the market clearing price.
• B)quantity demanded exceeds quantity supplied.
• C)an excess quantity demanded exists.
• D)all of the above

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Definitions:

Inventory Account

An account on the balance sheet that reports the value of a company's inventory, consisting of products available for sale.

Days In Inventory

An efficiency ratio that measures the average number of days a company holds inventory before turning it into sales.

Free For All

A situation or event in which everyone is allowed to participate without any restrictions or rules.

Days

A unit of time that typically refers to a 24-hour period, but in finance, it can relate to payable or receivable periods.