Which of the Following Is a Correct Statement

question 27

Multiple Choice

Which of the following is a correct statement?

• A)It is relatively easy to distinguish between cost-push and demand-pull inflation even if you don't know the source of the inflation.
• B)A supply shock will cause a variation of demand-pull inflation that can lead to hyperinflation.
• C)Demand-pull inflation will continue so long as there is excess total spending in the economy.
• D)Demand-pull inflation is usually accompanied by higher unemployment rates.

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Definitions:

Common Stock

Represents ownership shares in a corporation, giving holders voting rights and a share in the company's profits through dividends.

Net Income

The conclusive earnings of a firm after removing all financial outlays and tax obligations from its aggregate revenue.

Equity Method

An accounting technique used by firms to assess the profits earned by their investments in other companies, incorporating the income on the investor's income statement.

Amortization

The approach of progressively depreciating the initial investment in an intangible asset over its effective life.