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The use of a replacement cost definition of market is based on the assumption that a decline in an items replacement cost results in a

The use of a replacement cost definition of market is based on the assumption that

a decline in an items replacement cost results in a decline in its selling price.

prices will fall in the same proportion as input costs fall.

replacement cost is appropriate for all situations.

using net realizable value less a normal profit margin will arbitrarily shift profits from one period to another.

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