Scenario - the Audrey Firm

question 5

Multiple Choice

Scenario - The Audrey Firm
The Audrey Firm is an international trade consulting firm currently providing its services in eight foreign nations.The primary goal of this company is to prevent trade missteps from taking place between foreign nations conducting business with each other.The participating nations prefer to seek counsel with this firm before any of their actions result in major international involvement or World Trade Organization intervention.
In the past,the Audrey Firm's team of experts has handled international situations having the potential to create serious unrest between neighboring countries.Their guidance and expertise have been successful in keeping trade operating freely in several areas of the globe.The Audrey Firm is receiving an award for their exemplary service later this year in Washington D.C.
-As one of the Audrey Firm's more prestigious clients,OPEC,which exemplifies an export cartel,requires constant overseeing to ensure it complies with the agreement arranged for export cartels.Which one of the following items is least likely to appear on this type of agreement?

• A) Substitutes for the goods being offered must not be available
• B) Demand for the product in question must be elastic
• C) There needs to be a strong demand for the product in question at basically any price
• D) There must be no cheating on the stated agreement by the agreeing members
• E) Inelasticity in the demand for the product being offered must exist

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Definitions:

Credits

Accounting entries that increase liability or equity accounts, or decrease asset or expense accounts.

Liabilities

Financial obligations or debts that a company owes to others, which must be settled over time through the transfer of assets, provision of services, or other means.

Debits

Accounting entries that result in an increase in assets or expenses and a decrease in liabilities, equity, or income.

Credits

In accounting, credits are entries that decrease assets or increase liabilities and equity on a company's balance sheet.