How Will an Export Quota Imposed by a Large Exporting

question 86

Multiple Choice

How will an export quota imposed by a large exporting country affect the domestic price?

• A) It will cause an increase in the domestic price.
• B) It will cause a decrease in the domestic price.
• C) It will have no effect upon the domestic price.
• D) It will first cause an increase, then a decrease in the domestic price.

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Definitions:

Cost Of Goods Sold

The total cost directly associated with producing goods sold by a business, including materials and labor.

Perpetual Inventory System

An inventory system under which the company keeps detailed records of the cost of each inventory purchase and sale, and the records continuously show the inventory that should be on hand.

FIFO Method

An inventory valuation method that assumes the first items placed into inventory are the first sold, thus expenses are based on the oldest costs.

Latest Goods On Hand

Refers to the most recent inventory of products or materials that a company has available for use or sale.