"Few If Any Economists Anticipated the Extent of the Inventory

question 143

Multiple Choice

"Few if any economists anticipated the extent of the inventory adjustment... Production cutbacks have been much greater than expected. Those cuts have weakened the industrial sector considerably. " As a result of these changes, the U.S. government lowered its estimate of
Fourth- quarter growth in real GDP.
HYPERLINK "http://www.businessweek.com/" www.businessweek.com 3/12/20
The article suggests that _ .

• A) the AD curve shifted rightward in 2007.
• B) the AE curve shifted upward in 2007.
• C) planned expenditures exceeded real GDP in 2006.
• D) real GDP exceeded planned expenditures in 2006.

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Definitions:

Effective Tax Rate

The average percentage of net income that a person or corporation pays in taxes, effectively showing the portion of income gone to taxes.

Non-Controlling Interest

A minority share of ownership in a subsidiary that is not directly controlled by the parent company, typically reflected in the equity section of the consolidated financial statement.

Consolidated Financial Position

A representation of a parent company and its subsidiaries' financial status as one entity, summarizing assets, liabilities, and equity.

Acquisition Differential

The difference between the purchase price of a company and the fair value of its identifiable net assets at the acquisition date.