An Increase in Optimism About the Strength of the Economy

question 54

Multiple Choice

An increase in optimism about the strength of the economy will

• A)cause the investment share line to shift to the left.
• B)cause a leftward movement along the investment share line.
• C)have no effect on the investment share line.
• D)cause the investment share line to shift to the right.
• E)cause a rightward movement along the investment share line.

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Definitions:

Carrying Values

The recorded cost of an asset in a company's financial statements, minus any accumulated depreciation or amortization.

Proportionate Consolidation Method

An accounting technique used to combine a company's share of the assets, liabilities, income, and expenses of a jointly controlled entity on a line-by-line basis in its financial statements.

Fair Value Enterprise Method

A valuation approach determining the price a willing buyer would pay for an entire business in an orderly and open market transaction.

Identifiable Net Assets Method

A valuation method that calculates an entity's value based on the fair value of its identifiable tangible and intangible assets minus its liabilities.