A Weakness of ___(Insert from Below)____ Is That Firms Can

question 140

Multiple Choice

A weakness of ___(insert from below) ____ is that firms can increase or decrease net income by choosing to sell particular investments with net unrealized gains or unrealized losses:

• A)the available-for-sale approach.
• B)the trading-securities approach.
• C)both the available-for-sale and trading-securities approaches.
• D)neither the available-for-sale and trading-securities approaches.under the available-for-sale approach, unrealized gains and losses are accumulated in AOCI and only recognized in income when the investment is sold.

---

Definitions:

Mass Transit

Public transportation systems designed to move large numbers of people efficiently via buses, trains, subways, and other modes of transport.

Price Elasticity

A gauge of the responsiveness of the quantity of a good supplied or sought after to fluctuations in its price.

Equilibrium Point

A state in a market where the supply of goods matches demand, resulting in stable prices and quantities.