Shifts in supply or demand I The following oraph shows the market for hot dogs in Detroit, where there are over 1,000 hot dog stands at any given moment. Suppose a new scientific study shows that Detroit is the most polluted city in the world. Due to health concerns, a significant number of families move out of the city Show the effect of this change on the market for hot dogs by shifting one or both of the curves on the following graph, holding all else constant
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The term "supply" refers to the overall quantity of a certain commodity that is made available to the market for consumption.
Demand and supply have a strong relationship that influences market equilibrium, which determines the number of items available on the market and their selling prices.
The supply is graphically represented, and the supply curve, which is represented as an upward-sloping line, maps the link between price and quantity.
Market demand, financial limitations, customer preferences, and governmental policy all affect supply.
Despite the fact that there are different types of supply, supply is frequently divided into short-term and long-term supply.
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Related Questions
the buyers have $150,000 cash to buy a property. the home they would like to purchase will take $180,000. they are both over 65 and do not want payments. which is the best choice for accomplishing their goal?
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Borrow money with a reverse mortgageCan you use a reverse mortgage to borrow against the equityWith a reverse mortgage, homeowners may borrow a portion of their home's equity as tax-free income if they are 62 years of age or older and have paid off their mortgage
Borrowing money might be used to establish a new business pay for college tuition, or finance a new housePeer-to-peer lending and loans through 401(k) plans are two additional financing possibilities in addition to traditional financial institutions including banks, credit unions, and financing firms (k) Banks, credit unions, and finance firms are examples of conventional lenders. Sociallending and crowdlending are other names for peer-to-peer lending Banks provide a number of options to borrow money, including mortgage products, personal loans, vehicle loans, and construction loans. They also provide possibilities. Borrowers should be aware of the terms, interest rate, and costs of the loananks
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How should oil companies react if oil prices rise to the $90 to $100 per barrel level? Explain your reasoning
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Answer:
Explanation:
Oil price increases are generally thought to increase inflation and reduce economic growth. In terms of inflation, oil prices directly affect the prices of goods made with petroleum products. As mentioned above, oil prices indirectly affect costs such as transportation, manufacturing, and heating.
The ultimate measure of performance is: A)The amount of the firm's earnings B)How the earnings are valued by the investor C)The firm's profit margin D)Return on the firm's total assets
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Answer: option
option
Explanation:
As the business cycle moves through its phases, it must pass through a low point. Which of the following is the correct term for this low point?Select the correct answer below:a.trade deficitb.peakc.troughd.trade surplus
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The correct term for the low point of the business cycle is trough. Thus Option C is the answer.
The business cycle is the fluctuation of economic activity, such as employment and GDP, that occurs over time. The cycle is typically divided into four phases: expansion, peak, contraction, and trough.
During the expansion phase, economic activity is increasing, while during the contraction phase, it is decreasing. The peak is the point of highest economic activity, while the trough is the point of lowest economic activity.
The trough is often referred to as a recession, a period of time when the economy is in a state of decline. A trade deficit is when a country imports more goods and services than it exports, while a trade surplus is when a country exports more goods and services than it imports. These terms are related to balance of trade and not related to the phases of business cycle.
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the four basic accounting assumptions (select all that apply.) multiple select question. identify the entity being reported on assume the entity follows proper gaap standards identify asset and liability values identify the frequency of reporting assume the entity will continue to exist identify the denomination in which reporting occurs
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The four basic accounting assumptions are multiple A: "identify the entity being reported on", D: "identify the frequency of reporting ", E: "assume the entity will continue to exist", and F: "identify the denomination at which reporting occurs".
Accounting refers to the method of measuring, processing, and sharing financial and other information about businesses and enterprises. It means that accounting is the process that deals with keeping the accounting books of the financial transactions of businesses and enterprises. Following are the four primary assumptions of accounting:
Identifying the entity being reported onDetermining the frequency of reportingAssuming the entity will continue to existFinding the denomination in which reporting occursYou can learn more about profit accounting at
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Which of the following is an example of a marketing source when searching for information of a product?answer choicesFriendsSchool LibraryProduct Advertisements
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Answer:
product advertisement
to better meet corporate goals this year, yumiko, a ceo, is encouraging her managers to focus on the major functions of management, which are
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To better meet corporate goals this year, Yumiko, a CEO, is encouraging her managers to focus on the major functions of management, which include - planning, organizing, leading, controlling
Management (or managing) is the organization of an association, whether it is a business, a philanthropic association, or an administration body. It is the workmanship and study of overseeing assets of the business.
The executives incorporates the exercises of setting the procedure of an association and planning the endeavors of its workers (or of workers) to achieve its goals through the use of accessible assets, for example, monetary, normal, mechanical, and HR. "Maintain the business" and "Change the business" are two ideas that are utilized in administration to separate between the proceeded with conveyance of labor and products and adjusting of labor and products to meet the changing requirements of clients - see pattern. The expression "the executives" may likewise allude to those individuals who deal with an association — managers.
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Many economists have argued that these adjustable-rate mortgages greatly contributed to the 2007-2008 financial collapse because these are mortgages that have what kind of interest rate?
A. Unsecured
B. Fixed
C. Variable
D. Principal
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According to several observers, adjustable-rate mortgages largely contributed to the financial crisis of 2007–2008 since they have (C) variable interest rates.
What are the variable interest rates?Any sort of financial instrument, such as a loan, bond, mortgage, or credit, that does not have a fixed rate of interest over the instrument's life is said to have a floating interest rate, also known as a variable or adjustable rate.
Typically, floating interest rates fluctuate in response to a reference rate (a benchmark of any financial factor, such as the Consumer Price Index).
The London Interbank Offered Rate, or LIBOR, is one of the most popular reference rates to use as the foundation for implementing floating interest rates (the rates at which large banks lend to each other).
Many analysts contend that because adjustable-rate mortgages contain variable interest rates, they significantly contributed to the financial meltdown of 2007–2008.
Therefore, according to several observers, adjustable-rate mortgages largely contributed to the financial crisis of 2007–2008 since they have (C) variable interest rates.
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what is the appropriate date to identify the statement of financial position of a calendar-year client for the year 20xx?
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Option (A) as of the end of 2017 The statements of financial situation is provided at a particular date (a summary as of that date), typically at the conclusion of the fiscal year .
What function does financial position serve?A financial report is frequently used to evaluate a company's condition in terms of possible risk and financial stability. A typical statement will usually include a summary of a company's assets, liabilities, and equity (such as loans, VAT, and Corporation Tax) .
What is the structure of financial positions?The combination of debt - equity that such a company utilizes to finance company operations is referred to as financial structure. The capital structure is another name for it.
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The Complete Question :
What is the most appropriate date to identify the statement of financial position of a calendar-year client for the year 2017?
A) As of December 31, 2017.
B) At January 1, 2018.
C) For the period January 1 to December 31, 2017.
D) For the period ending December 31, 2017.
ou live in a city where the east-west streets are named using letter of the alphabet and the north-south avenues are named using numbers. the streets and avenues are arranged in grids the streets are perpendicular to the avenues. you live on f street a half mile east of 2nd avenue. your friend lives on the same street. both of you decide to meet at the neighborhood market at the end of 2nd avenue directly north of f street. if both of you are able to walk diagonally from your respective houses to the market, and both of you leave your houses at the same time and walk at the same pace, who will get to the market first?
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Let's see that between the three points you can draw an equilateral triangle since the distance between you and your friend from the second avenue is the same and the streets are perpendicular to each other (besides that they form a grid). Since both must travel the same distance and neither is supposed to be faster than the other. Your friend and you will arrive at the market at the same time.
What would you say is a market?In order to expedite the exchange or transaction of products and services, buyers and sellers can come together in a market. A market may be actual, like a real store, or it may be virtual, like an online retailer. Financial markets, auction markets, and criminal markets are other examples.
What is market definition crucial?A framework for competition analysis is provided by market definition. In order to compute market shares, for instance, the market must first be defined, and in order to take into account the possibility of new entrance, the market that might be targeted must be identified.
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The revenue generated by Company X is divided between Doug and Moira in a 6 to 5 ratio respectively.
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The total profit is $12000. One of a business's top priorities is to turn a profit. Determine your level of success by calculating your profit.
What is total profit?In other words, your revenue minus your manufacturing or production costs equals your gross profit, whereas your net profit is your gross profit less the cost of all business operations and non-operations. Your net profit will be a much more accurate reflection of your company's earnings. One of a business's top priorities is to turn a profit. Determine your level of success by calculating your profit. This will also show you where your company is making money and where you are spending it. When referring to anything, the terms "gross" and "net" both refer to its entirety or entire amount, respectively.Let A's portion of profit be X
B's portion of profit be X+$3000
A/B=3/5
X/X+$3000=3/5
Simplifying,
5X=3X+$9000
2X=$9000
Then,
X=$4500
Total profit will be
X+X+$3000
2X+$3000
2($4500)+$3000
We get,
$12000
The complete question is,
The annual profit of a business was divided between two partners, A and B in the ratio 3:5. If B received $3,000 more than A, what was the total profit?
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what does the mortage lender most often rely on when deciding how much is safe to lend on a parcel of real estate
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Mortage lender prepare appraisal report most often rely on when deciding how much is safe to lend on a parcel of real estate.
What Is an Appraisal Report?An appraisal report is a thorough document that describes a property's value in relation to its calibre, state, location, and market circumstances. This impartial report is created by a real estate appraiser following a thorough inspection of the property.The standards for appraisal reports are outlined in the Uniform Standards of Professional Appraisal Practice and can be delivered in one of three textual formats: self-contained reports, summary reports, or restricted-use reports.In general, mortgage lenders will ask for an appraisal to get a thorough picture of the property based on its general state, neighbourhood conformance, and market worth. The appraisal report is used to support the lender's decision to make a loan.Learn more about Appraisal Report refer to :
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what is an example of a direct-action message? a. a local grocery store ad for fresh produce b. a political ad promoting reduced government spending c. a car company ad promoting corporate responsibility d. an ad selling cleaning services to hotels
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(A) "Vegetable advertisement from a nearby grocery shop" is an example of a direct-action message.
What is a direct-action message?An advertisement intended to persuade viewers to visit a particular location and perform a certain action, such as making a purchase, using a service, or engaging in a particular activity
A direct action message can be seen in the Coca-Cola commercial that we viewed during the advertising lesson.
The term "big idea" refers to an advertising notion that will catch consumers' attention, stick in their minds, and prompt them to take action.
To make the message more readable, use graphic tools. In the subject line, specify past correspondence and the subject. Put the most crucial details first.
Therefore, (A) "vegetable advertisement from a nearby grocery shop" is an example of a direct-action message.
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Surprise inflation can help people who have borrowed money. Click or tap "True" or "False" to answer the question. True False
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It is true that surprise inflation can benefit borrowers.Surprise inflation: when inflation is not predicted, it is good.
How would you define surprise inflation?Unexpected events can boost demand for products and services beyond what can be supplied by producers, leading to unanticipated inflation, which causes prices to climb more quickly than anticipated.
Who stands to gain from unforeseen inflation?Unexpected inflation benefits borrowers since the amount they repay is less valuable than the amount they borrowed.The most common victims of inflation are lenders and savers. While people who borrowed money at lower fixed interest rates are trapped with less valuable loans until they mature, savers see their cash deposits lose some of their purchasing power.
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what are some types of ppe that employers must pay for
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Examples of PPE that Employers Must Pay for Include: hard hats, hearing protection, fall protection harness, NOT uniforms.
What is PPE?PPE is gear that will shield the user from the risk of injuries or other negative health impacts. It may consist of things like safety boots, respiratory protective equipment, high-visibility clothes, gloves, safety helmets, and eye and eye protection (RPE).
In order to encourage employees to work safely and responsibly, the workplace must be made safe. This involves providing instructions, procedures, training, and supervision.
Some dangers may still exist even after engineering controls and safe work practises have been implemented. These include
wounds to the lungs, such as those caused by breathing in contaminated air, the head and feet, such as those caused by falling objects, the eyes, such as those caused by flying particles or liquid splashes, the skin, such as those caused by contact with corrosive materials, and the body, such as those caused by extreme heat or cold.In these circumstances, PPE is required to lower the risk.
Payment for Personal Protective EquipmentWhen it is required to safeguard employees from work-related injuries, illnesses, and fatalities, many Occupational Safety and Health Administration (OSHA) requirements mandate that businesses provide personal protective equipment. With very few exceptions, OSHA mandates that employers cover the cost of PPE when it is utilised to adhere to OSHA rules. Hard hats, gloves, goggles, safety shoes, safety glasses, welding helmets and goggles, face shields, chemical protective equipment, and fall protection equipment are a few examples of what is frequently used.
A new OSHA regulation on employer reimbursement for PPE came into effect on May 15, 2008. With very few exceptions, OSHA currently mandates that employers cover the cost of PPE used to adhere to OSHA rules.
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what is considered a human rights abuse by an american company may be viewed as an acceptable business practice in china, which illustrates that
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Which illustrates that moral standards are relative to particular societies.
The Covenant deals with so much rights as opportunity of development; uniformity under the steady gaze of the law; the right to a fair preliminary and assumption of guiltlessness; opportunity of thought, heart and religion; opportunity of assessment and articulation; serene gathering; opportunity of affiliation; cooperation in open issues and decisions; and security of minority rights. It restricts erratic hardship of life; torment, savage or corrupting treatment or discipline; bondage and constrained labor; inconsistent capture or detainment; erratic impedance with security; war misleading publicity; segregation; and support of racial or strict disdain.
A progression of international human rights treaties and different instruments embraced starting around 1945 have extended the group of international human rights regulation.
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the fee paid to a firm in a licensing agreement that gives another firm the right to manufacture their product or use its trademark is called
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The fee paid to a firm in a licensing agreement that gives another firm the right to manufacture their product or use its trademark is called Royalty
The term licensing agreement alludes to a legitimate, composed agreement between two gatherings wherein the land owner allows to one more party to utilize their image, patent, or brand name. The understanding, which is set between the licensor (the land owner) and the licensee (the allowed party), contains subtleties on the kind of permitting arrangement, the terms of utilization, and how the licensor is to be redressed. Contract types differ in light of what is being authorized. Permitting arrangements likewise reduce any debates connected with deals, issues of value, and royalties.
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in a lean organization workers are treated as assets. what does this mean in a lean organization? (select all the examples that apply.) multiple select question. workers are each given a dollar value for cost accounting purposes. workers are given authority to make decisions that effect their work. workers are well-trained in lean philosophy and methods.
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This mean in a lean organization that b) workers are given authority to make decisions that effect their work and c) workers are well-trained in lean philosophy and methods .
A lean organizational structure is one that is intended to provide more value to customers while utilizing fewer resources than a typical organizational structure.
The goal for all members of a lean structure organization is to constantly look for ways to improve the organization's processes and make it more efficient. Jim has a significant number of job classifications in his traditionally structured organization.
Jim's employees are often focused on their own tasks and do not examine how their work affects the overall operation of the organization. They also have little interaction with anyone outside of their department. Slim's lean organization organizes its employees using only a few job classifications.
Members of his organization are more broadly competent and adaptable, and they are empowered to look for and address problems as they arise in the business's day-to-day operations.
Slim's employees operate in self-managed work teams rather than functional departments. Members of Slim's organization work in teams to constantly enhance their work procedures and remove waste.
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Which of the following is NOT important to a manager at a merchandising company when preparing the master budget
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An organisation that provides services or sells merchandise won't have a budget for production, direct materials, direct labour, or overhead. The main distinction is that even when we don't have a budget for production or material purchases, we still need to know how much inventory we should acquire for a merchandiser.
What expenditures wouldn't be included in a combined cash budget?
As a non-cash expense, depreciation expense would never be included in a cash budget. Cash-only budgets simply keep track of actual cash payments and receipts. All of the items listed above will result in a cash outflow, including interest costs and travel costs.
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T/F Without engaging in international trade, Freedonia and Desonia would have been able to consume at the after-trade consumption bundles
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The concept given is International trade, which is the exchange or trade of goods and services between different nations. The answer is, false.
International trade is the exchange of capital, goods, and services across international borders or territories due to the need or scarcity of goods or services.
In most countries, this trade accounts for an important part of the gross domestic product. One of the most important benefits of international trade is market diversification.
By focusing solely on your home market, you may be at greater risk from economic downturns, political factors, environmental events, and other risk factors, and help Americans provide goods and services to their families.
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the process of bringing wood flooring to the job site 4-5 days before installation to allow the room and flooring to have similar moisture content is called what
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The process of bringing wood flooring to the job site 4-5 days before installation to allow the room and flooring to have similar moisture content is called acclimation.
Wood flooring is hygroscopic, which means it absorbs and releases moisture depending on the humidity levels in the surrounding environment.
Acclimation is the process of allowing the wood flooring to adjust to the humidity levels in the room where it will be installed. This ensures that the moisture content of the wood flooring is similar to that of the room, which reduces the risk of the flooring cupping, warping, or cracking after installation.
When wood flooring is delivered to a job site, it is usually at a different moisture content than the room where it will be installed.
If the wood flooring has a higher moisture content than the room, it will release moisture and shrink after installation, while if it has a lower moisture content, it will absorb moisture and expand after installation.
Acclimation helps to minimize these issues by allowing the wood flooring to reach equilibrium with the surrounding environment before it is installed.
In summary, the process of bringing wood flooring to the job site 4-5 days before installation to allow the room and flooring to have similar moisture content is called Acclimation.
It is an essential step in the installation process of wood flooring as it ensures that the moisture content of the wood flooring is similar to that of the room, reducing the risk of cupping, warping, or cracking after installation.
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The relationship of $325,000 to $125,000, expressed as a ratio, is a. 2.0 to I b. 2.6 to 1 c. 2.5 to I d. 0.45 to 1 23.
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Option (b), Ratio representation of the relationship between $325,000 and $125,000 is 2.6 to 1.
How does the ratio and the example work?The ratio is written as a/b when the ordered pair's second number, b, is not equal to 0. A percentage is a mathematical term that converts two ratios into a single value. The ratio would be written as 1: 3 and would consist of one guy and three women. Three girls are present for every boy.
The letter ":" stands in for the ratio sign. a case in point A ratio can also be represented as "5 is to 4," which is written as 5:4, or as a fraction, like 5:4. To denote the ratio of any two similar quantities, p and q, use the symbols p/q or p:q.
First No.= $325,000
Second No.= $125,000
Ratio representation= 325,000 / 125,000= 2.6 : 1
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Which of the following is an example of substitutes ?
(a) Tea and sugar
(b) Tea and coffee
(c) Pen and ink
(d) Shirt & trouser
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Tea and Coffee are examples of substitutes.
Hence Option B is correct
In microeconomics, substitutes are two items that consumers can employ for the same purpose. Because they view both products as comparable or similar, consumers will desire less of one when there is more of the other.
Think of the commodity pairs tea and coffee as an example of substitution. There is a negative link between any pair of complementary commodities.
In microeconomics, substitutes are two items that consumers can employ for the same purpose. Because they view both products as comparable or similar, consumers will desire less of one when there is more of the other. Unlike gifts and gratuitous services.
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Brandon, an officer for Beta Inc., contracts with Office Stuff for five new copy machines. The copiers are delivered, but Beta does not pay for them. Office Stuff sues. Which of the following best describes the situation? Brandon is liable, Beta is not. Brandon and Beta are both liable. Beta is liable; Brandon is not. Neither Beta nor Brandon are liable.
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Beta is liable; Brandon is not. Brandon, an officer for Beta Inc., contract with Office Stuff for five new copy machines. The copiers are delivered, but Beta does not pay for them. Office Stuff sues.
A contract is an agreement between persons that creates mutual responsibilities that are legally binding. Mutual assent, indicated by a legitimate offer and acceptance; appropriate consideration; capability; and legality are the key factors necessary for the agreement to be legally binding. A contract is an agreement that establishes specific legally binding rights and duties for two or more mutually consenting parties. A contract usually involves the exchange of products, services, or money, or the promise to exchange any of these at a later period. Contract law, or the law of obligations relating to contracts, is founded on the concept that agreements must be honored. Contract law, like other aspects of private law, differs by country. Contract law is generally applied and controlled.
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in its year 1 income statement, noll corp. reported depreciation of $400,000 and interest revenue on municipal obligations of $60,000. noll reported depreciation of $550,000 on its year 1 income tax return. the difference in depreciation is the only temporary difference, and it will reverse equally over the next three years. noll's enacted income tax rates are 35% for year 1, 30% for year 2 and 25% for year 3 and year 4. assuming noll expects to report taxable income in all future years, what amount should be included in the deferred income tax liability in noll's december 31, year 1 balance sheet?
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The amount that ought to be accounted for in the deferred income tax liability in Noll's December 31, year 1 balance sheet would be $40,000 if it is assumed that Noll will report taxable income in each and every subsequent year.
Who Pays Taxes?Taxes are mandatory payments that citizens or corporations must make to their local, state, or federal government. Tax revenue is used to pay for public projects and programs like Social Security and Medicare as well as infrastructure like roads and schools.
People pay taxes for what reasons?All inhabitants gain from taxes that are used to fund defense, roads, police, and a justice system, among other essential services, because they are unable to successfully provide such services for themselves.
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a writer that assures premiums will be paid on a juvenile policy until the child reaches a specific age is called
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A rider whereby premiums are assured to be payee on a juvenile policy is called: a payor rider.
What is a Payor writer?The person making the payment, satisfying the claim, or settling a financial obligation. For example, the person writing a check is the payor, or an employer paying their worker is the payor.
A payor writer is a type of rider whereby an individual is exempted from paying premium if the premium payor becomes late, or based on the fact that they are totally disabled before the juvenile reaches majority or the total disability occurred before the 25th birthday of the person that is being insured.
Thus, in any of the two scenarios, the subsequent premiums that ought to be payee by the premium payor is therefore waved automictically, which is based on a juvenile policy.
In conclusion, we can state that, a writer whereby premiums are assured to be payee on a juvenile policy is called: a payor writer.
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jones international is a large organization with holdings in the united states, europe, and southeast asia. the corporation's mix of strategic business units (sbus) allows the company to exploit its strengths and capabilities in more than one line of business and to exploit synergies across business lines. one of the disadvantages of jones international's strategy is that it . a. increases management complexity b. increases economic risk c. increases the company's dependence on the success of its largest sbu d. increases overhead costs e. exploits the strengths of competitors
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A sizable company, Jones International has operations in the United States, Europe, and Southeast Asia.
Briefing:-The corporation's mix of strategic business units (subs) enables it to take advantage of its strengths and capabilities in many business lines as well as cross-industry synergies. The technique employed by Jones International has the drawback of adding to management complexity.
Which of the following describes the typical actions of an organization that opposes the need to change business processes?The propensity for an organization as a whole to oppose change and want to preserve the status quo is known as organizational inertia. Companies that experience inertia become rigid and unable to adjust in response to external or internal challenges.
In order for an organization to support differentiation, which of the following must take place?Sales and marketing efforts must place a strong emphasis on the high value of an organization's products.
Which of the following places more of an emphasis on resources and mission than it does on people and action?Operational planning typically concentrates on people and activity, whereas strategic planning concentrates on resources, environment, and mission. Employees who receive quarterly bonuses are more likely to engage in short-term planning than those who receive quadrennial bonuses.
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your business conducted a risk assessment and did everything possible to mitigate the current risk. which treatment will address the residual risk that falls within the risk appetite?
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Your business conducted a risk assessment and did everything possible to mitigate the current risk. Risk acceptance treatment will address the residual risk that falls within the risk appetite.
How can residual risk be reduced?
Generally speaking, organisations should take the following actions to address the residual risk. Determine the pertinent governance, then determine risk, and compliance needs. Identify the control structure for the organization's strengths and shortcomings. Be aware of potential risks. If management determines that the degree of residual risk is unbearable, it may return to the third phase of the process and look for further potential risk reduction solutions.
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when dealing with variable lead times, it is better to use safety stock than safety time to mitigate the impact of a shortage of any component required for final assembly. true false question. true false
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True. Safety stock is a method of inventory management that helps mitigate the risk of shortages by maintaining a reserve of items in case of unexpected delays or other issues that may cause production to be delayed.
Safety time is also a form of inventory management, but it is more focused on planning and scheduling, which is not as effective when dealing with variable lead times. Safety stock is a more effective solution for dealing with variable lead times, as it helps to ensure that components are available when needed.
Therefore, the given statement is true.
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Equity, as represented in the accounting equation, would increase as a result of which of the following items
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Revenues, gains, expenses, and losses are the primary accounts that have an impact on owner's equity. If you make money, your owner's equity will rise. earnings derived from running a business.
Which accounts cause an increase in equity?If you incur losses and expenses, your owner's equity will decline. Your owner's equity will be negative if your obligations surpass your assets. If all other factors are equal, a company's equity will rise when its assets do, and vice versa. Reducing obligations, for as by paying off debt, will raise equity whereas adding liabilities will lower equity. Modern accounting techniques depend on these fundamental ideas to function. Stockholders' equity rises as a result of more stock investments or more net income. A net loss or dividend payments cause it to go down. If revenue accounts are closed out into retained profits, retained earnings rises; if expense accounts and cash dividends are closed out into retained earnings, retained earnings fall.
The complete question is:
Equity, as represented in the accounting equation, would increase as a result of which of the following items?
Earnings from operating a business.
Earning from loss
Both 1 and 2.
None of the above
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