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____ [38]
3 years ago
7

The total value of commodity A produced in Country X increased from​ $500,000 in 2011 to​ $700,000 in 2012. According to​ Laura,

a student of​ economics, the share of commodity A in real GDP of 2012 should be higher than that of 2011.
Which of the​ following, if​ true, would strengthen​ Laura's argument?

A.

Only a fraction of commodity A produced in 2012 was consumed in the same year.

B.

The total amount of inputs used in the production of commodity A was higher in 2011 than in 2012.

C.

The scale of production in 2012 was smaller than in 2011.

D.

The average price level in the economy remained stable over the two years.

E.

The quantity of commodity A produced in 2011 was higher than in 2012.
Business
1 answer:
guajiro [1.7K]3 years ago
4 0

Answer:

D. The average price level in the economy remained stable over the two years.

Explanation:

Real GDP is a GDP measured using the price of a certain base year as opposed to GDP measured at current prices known as nominal GDP. GDP at current prices may be affected by inflation or deflation and must be deflated if the economy is experiencing inflation. The value of $700,000 for commodity A in 2012 is supposed to deflated to remove the effect of inflation and the value will come back to 2011 value of $500,000 , but if the price level is fairly stable the GDP deflator can not bring it back to $500,00, but some higher value.

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1. Congress passed the Sarbanes-Oxley Act to ensure that investors invest only in companies that will be profitable.
Oksana_A [137]

Answer:

1. False

2. False

3. False

4. True

5. True

Explanation:

1.

Sarbanes-Oxley Act was a federal law that was established by congress to sweep auditing and financial statements for public companies. The main aim for this was to improve the investor confidence by improving reliability in accounting statements. Errors in the financial statements for the public companies were to be minimized following this law especially in the wake of numerous cases of corporate crime. This law was never passed to ensure that investors only invest in companies that will be profitable, since the choice of which company to invest in is exclusively left to the investor. So the above statement is false.

2.

Ethics can be defined as a set of rules and regulation that govern the moral behavior of someone. Ethical standards vary from one region to another since they are majorly cultural, for example; a behavior in the United States can be considered as appropriate while the same behavior in a different place can be inappropriate. Ethical standards are either right or wrong, and the actions are judged on these terms. Ethics don't measure whether a actions are loyal or disloyal, thus the statement is false.

3.

The primary accounting standard setting body in the United States is Financial Accounting Standards Board (FASB). This body is charged with regulating and setting the best standard of accounting practice. The FASB usually constitutes a board whose officials are rigorously assessed. The board members have to be professionals in the field of accounting.  Securities and Exchange Commission on the other hand is an independent federal agency with the authority to enforce federal security laws. Thus the statement above is false.

4.

The historical cost principle suggests that the companies record assets cost at their original cost and continue to report them at their original cost over the time the asset is held. The historical cost principle is a generally accepted accounting principle that has been in use for a long time. The definition about the historical cost principle in the question above is therefor true.

5.

The monetary unit assumption dictates that business related activities be converted to monetary units. There are some business transactions that are however quite difficult to convert into monetary units, therefor the accountant in using this principle is only obliged to record only the transactions that can be measured in money terms. The statement about monetary units in the question above is thus true.

8 0
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At the beginning of its fiscal year, Lakeside Inc. leased office space to LTT Corporation under a ten-year operating lease agree
iVinArrow [24]

Answer: $20,000

Explanation:

The effect of the lease on Lakeside's earnings will be the difference between the earnings from the lease and the cost of the building which will be depreciation.

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Earnings per year;

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6 0
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Which two factors are important to consider when choosing a production method?
Hunter-Best [27]

Answer:

-The technology that is available for the market.

- The nature of the products

Explanation:

Latest technology often able to produce larger amount of products with significantly lower time. This will help reduce the overall cost of production in the long run.   Business owner need to consider this and calculate whether the initial investment that needed to be made to install the technology will worth the value in the long run.

Nature of the products consisted of all  the characteristics that our products process. For example food products tend to not have a long shelf life unlike fashion product. This difference in characteristics influence the type of production method that business owners could implement.

For example, It is impossible for business owners to mass produce produce food products with the expectation that it can maintain their quality in the warehouse, but producer of fashion products could make that expectation.

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