If a USResident Buys a $25, 000 Car from a Japanese Car

question 72

Multiple Choice

If a U.S.resident buys a $25, 000 car from a Japanese car maker, this transaction will:

• A)have a negative effect on Japan's balance of trade in merchandise.
• B)have a negative effect on the U.S.balance of trade in merchandise.
• C)have a positive effect on the U.S.balance of trade in merchandise.
• D)bring money into the United States.
• E)have no effect on Japan's balance of trade in merchandise.

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Definitions:

Weighted Average Cost

A method of calculating the cost of goods sold and ending inventory cost by taking into account the cost of goods purchased at varying prices.

Beginning Inventory

The value of a company's inventory at the start of an accounting period, used in calculating cost of goods sold.

Cost Of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including material, labor, and overhead costs.

Purchase Discounts

A deduction from the stated price of goods or services allowed by the seller to the buyer for prompt payment.