(Scenario: Demand and Supply for Iron Ore) This Table Represents

question 50

Multiple Choice

(Scenario: Demand and Supply for Iron Ore) This table represents a demand and supply schedule for a small-country producer of iron ore. It sells output in its home market and on the world market at the world price of $70 per ton. Table: Demand and Supply for Iron Ore What price will domestic iron ore consumers pay for their iron ore purchases when there is a $10-per-ton export subsidy?

• A) $10 per ton
• B) $60 per ton
• C) $70 per ton
• D) $80 per ton

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Definitions:

Accrual Basis

An accounting method that records income and expenses when they are earned or incurred, regardless of when the cash is actually received or paid.

Internal Service Funds

Funds used by a government or organization to account for the financing of goods or services provided by one department to other parts of the organization, on a cost-reimbursement basis.

Special Revenue Funds

Governmental funds intended to be used for specific revenue sources that are legally restricted to expenditure for particular purposes.

Debt Service Funds

Governmental funds used to account for the accumulation of resources for, and the payment of, general long-term debt principal and interest.