For the purpose of accounting, there are three types of expenditure. These are Capital Expenditure, Revenue Expenditure, and Deferred Revenue Expenditure.
Capital Expenditure is the amount incurred in acquiring long term assets like land, buildings, equipments (which are used for the purpose of earning revenues). These costs are reflected in the account of Property, Plant and Equipment.
Revenue Expenditure is cost incurred in one accounting year wherein the benefits are also enjoyed in the same period only. It does not increase the earning capacity of the business, instead, it maintains the existing earning capacity of said business. This expenditure is recurring in nature like salaries and wages, selling and distribution expenses.
Deferred Revenue Expenditure is a revenue Expenditure which has been incurred within the current accounting year but its benefit will be extended to a number of years. This cost is charged to the Profit and Loss account. Example of this is advertising cost.
The Right Response is Option C which is Long Term Changes in the Economy.
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Why Did Friedman Argued So?</u></h3>
- The concept of monetarism, which refers to the management of money in the economy, was developed by Milton Friedman. According to Friedman, changes in the money supply can have both long- and short-term consequences.
Friedman suggested that long-term changes in the economy had an impact on consumer behavior. Long-term economic developments have an impact on how consumers behave while making purchases. For instance, if long-term economic trends are favorable, consumer spending will rise; otherwise, it would fall.
Therefore, "long-term changes in the economy" is the right response.
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Correct Question - Milton Friedman argued that consumers are more likely to alter their behavior based on
a) changes in the unemployment rate.
b) short-term changes in the economy.
c) long-term changes in the economy.
d) changes in the inflation rate.
$5,040 since Irene earned nearly earned about $4,800 less than what she would be making if she did not make her early withdrawal.
