Economists Believe That Most Short-Run Fluctuations

question 33

Multiple Choice

Economists believe that most short-run fluctuations:

• A) Are the result of demand shocks
• B) Are the result of supply shocks
• C) Will not last long because prices will adjust to equalize the quantities demanded and supplied of goods and services
• D) Will always have a negative impact on real GDP, inflation, and unemployment

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Definitions:

Net Purchases

Net purchases are the total amount of purchases made by a business after subtracting returns, allowances, and discounts.

Cash Conversion Cycle

A measurement that calculates the duration required for a business to transform its inventory investments and additional resources into cash flows resulting from sales.

Accounts Receivable

Money owed to a business by its customers for goods or services provided on credit.

Accounts Payable

Accounts payable are amounts a company owes to suppliers for items or services purchased on credit; it is a current liability on the balance sheet.