If You Have $4000 and the GDP Deflator Decreases from 100

question 158

Multiple Choice

If you have $4000 and the GDP deflator decreases from 100 to 90

• A) the $4000 will buy 10 percent less of the goods and services produced by society.
• B) the $4000 will buy 10 percent more of the goods and services produced by society.
• C) the value of the $4000 decreases.
• D) the value of the $4000 remains constant.

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Definitions:

Sales Budget

A detailed forecast of future sales, typically the first step in the budgeting process, driving the company's production, workforce, and financial planning.

Cost of Goods Sold

The direct costs attributable to the production of goods sold in a company, including materials and labor.

Selling and Administrative Expenses

The total of all overhead and operational expenses directly tied to the selling and general management of an organization.

Budgeted Purchases

This refers to the estimated amount of goods or services that a business plans to buy over a specific period, as set out in its budget.