If a Market Is Allowed to Move Freely to Its

question 65

Multiple Choice

If a market is allowed to move freely to its equilibrium price and quantity,then an increase in supply will

• A)increase consumer surplus.
• B)reduce consumer surplus.
• C)not affect consumer surplus.
• D)Any of the above are possible.

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Definitions:

Revenue Recognition

The process of recording and identifying revenue in the financial statements when it is earned and realizable.

Percentage-of-Completion

An accounting method used to recognize revenue and expenses of long-term projects proportionally to the project's completion level.

Revenue Recognition

The accounting principle that dictates the conditions under which revenue is recognized or recorded, primarily focusing on the timing and amount.

Percentage-of-Completion

An accounting method recognizing revenues and expenses of long-term contracts as a percentage of work completed.