Which of the Following Is True When a County Is

question 12

Multiple Choice

Which of the following is true when a county is experiencing a trade deficit (NX < 0) ?

• A)demand for domestic goods is equal to the domestic demand for goods
• B)demand for domestic goods is greater than the domestic demand for goods
• C)demand for domestic goods is less than the domestic demand for goods
• D)a budget deficit exists

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Definitions:

Price Index

A price index measures the average change over time in the prices paid by consumers for a market basket of consumer goods and services.

Replacement Cost

The cost to replace an item or asset at current prices, disregarding its original purchase price or accumulated depreciation.

Operating Margin

A profitability measure calculated as operating income divided by revenue, showing the percentage of profits generated from operations before taxes and interest.

Variable Costing

An accounting method that only includes variable production costs (costs that change with the level of output) in the cost of goods sold and treats fixed costs as period costs.