When Calculating GDP from the Expenditure Side,which of the Following

question 49

Multiple Choice

When calculating GDP from the expenditure side,which of the following is true of the government purchases component,G_a?

• A)It includes government subsidies to private firms.
• B)It is based on the government's planned spending.
• C)It includes employment insurance and employment benefits.
• D)It excludes transfer payments.
• E)It only includes federal government expenditures.

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Definitions:

Owner's Equity

The residual interest in the assets of the entity after deducting liabilities, representing the ownership interest in the company.

Cash Payments Journal

A financial journal that records all cash payments made by a business, including expenses, purchases, and debt payments.

Sales Discounts

Reductions granted by sellers to buyers from the listed price as an incentive for early payment.

Accounts Payable

Liabilities or amounts owed by a company to its creditors for goods and services that have been delivered but not yet paid for.