Choose the Statement That Is Incorrect

question 74

Multiple Choice

Choose the statement that is incorrect.

• A)The debt- to- GDP ratio increased from 1974 through 1997, and then began to decrease.
• B)The federal government debt was 4.4 percent of GDP in 1971.
• C)The debt- to- GDP ratio increased slightly during the 2008- 2009 recession.
• D)As a percentage of real GDP, the federal government debt was greater in 2014 than in 1971.
• E)The government debt increases when the government has a budget deficit.

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Definitions:

Inventories

Assets held for sale in the ordinary course of business, in the process of production for such sale, or in the form of materials or supplies to be consumed in the production process or in the rendering of services.

Depreciation Expense

The allocated portion of the cost of a tangible or physical asset that is charged as an expense over its useful life.

Operating Activities

Activities directly related to the business's primary operations, such as selling products or services, which are reflected in the company's cash flow.

Net Income

Net income is the total profit a company generates after subtracting all its expenses, taxes, and losses from its total revenue.