A Company Does Not Have Sufficient Inventory of Materials Ordered

question 18

Multiple Choice

A company does not have sufficient inventory of materials ordered by a customer.So,it ships what it has now and will ship the remaining at a later date when more materials are available.Which of the following best describes the above scenario?

• A)balked shipment
• B)rejected shipment
• C)picking
• D)backorder

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Definitions:

Inflationary Gap

Occurs when equilibrium GDP is greater than full-employment GDP.

Equilibrium GDP

The level of Gross Domestic Product where aggregate supply equals aggregate demand, indicating a stable economy with no tendency for change in the price level or output.

Multiplier

Any change in spending (C, I, or G) will set off a chain reaction leading to a multiplied change in GDP. Equation is 1/(1 - MPC).

Federal Budget Deficit

A situation where the government's expenditures exceed its revenues over a specific fiscal period.