Use the Following to Answer Questions

question 182

Multiple Choice

Use the following to answer questions:
Figure: Trade
-(Figure: Trade) Refer to the figure. With free international trade, the country in this figure will find that the good:

• A) becomes cheaper for domestic consumers.
• B) becomes more expensive for domestic consumers.
• C) does not change in price.
• D) may get cheaper or more expensive for domestic consumers but it is impossible to tell.

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Definitions:

Target Costing

A pricing strategy in which a product's selling price is determined by market conditions, and the production cost is managed to ensure profitability.

Desired Return

the minimum profit or return a company or investor aims to achieve from an investment or venture.

Investment

The allocation of resources, such as capital or time, with the expectation of generating an income or profit.

Absorption Costing

An accounting method that includes all manufacturing costs, both direct and indirect, in the cost of a product.