A Consumer Chooses an Optimal Consumption Point Where the

question 177

Multiple Choice

A consumer chooses an optimal consumption point where the

• A)marginal rate of substitution is maximized.
• B)slope of the indifference curve exceeds the slope of the budget constraint by the greatest amount.
• C)ratio of the marginal utilities equals the ratio of the prices.
• D)All of the above are correct.

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Definitions:

Adjusting Entries

are journal entries made at the end of an accounting period to adjust income and expense accounts so that they comply with the accrual concept of accounting.

Adjusting Entries

Entries made in journal accounts to correct any discrepancies and ensure that the revenue and expense recognition principles are followed accurately.

Relevant Financial Information

Financial data that is capable of making a difference in business decisions, being timely and having predictive and confirmatory value.

Cash Basis

Cash basis is an accounting method where revenues and expenses are recorded only when cash is received or paid, regardless of when the transactions occurred.