Prices in Both the U

question 46

Multiple Choice

Prices in both the U.S.and India rise,but prices in India increase by a smaller percentage.According to purchasing-power parity the U.S.dollar

• A)gains value both in terms of the domestic goods and services it can buy and in terms of the Indian currency it can buy.
• B)gains value in terms of the domestic goods and services it can buy,but loses value in terms of the Indian currency it can buy.
• C)loses value in terms of the domestic goods and services it can buy,but gains value in terms of the Indian currency it can buy.
• D)loses value both in terms of the domestic goods and services it can buy and in terms of the Indian currency it can buy.

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Definitions:

Semivariable Cost

Costs that have both fixed and variable components, changing in response to activity level but not directly proportional to it.

Variable Costs

Costs that change in proportion to the level of goods or services produced, including costs for materials and labor directly involved in production.

Total Costs

The sum of all expenses incurred in the production of goods or services, including fixed and variable costs.

Units

A basic measure of quantity in accounting or inventory management, representing a single item or element of output.