What Is an Operating Activity

question 48

Multiple Choice

What is an operating activity?

• A)Activities involving the acquisition and disposal of long-term assets.
• B)Activities involving changes in the size and composition of the contributed equity.
• C)Activities involving the principal revenue-producing activities of the entity.
• D)Activities that do not involve cash.

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Definitions:

Crowding-Out Effect

A situation where increased government spending leads to reduced investment in the private sector, typically because of higher interest rates or the use of available financial resources.

Keynesians

Economists who follow the theories of John Maynard Keynes, emphasizing the role of government intervention and fiscal policy in managing economic cycles.

Monetarists

Economists who suggest that fluctuations in the money supply are key in affecting national output in the short term and in determining the price level over an extended term.

Crowding-Out Effect

The phenomenon where increased government spending leads to a reduction in private sector spending and investment due to higher interest rates or other factors.