Which of the Following Statements Is Correct

question 110

Multiple Choice

Which of the following statements is correct?

• A) Investment represents household purchases of assets.
• B) Net exports are imports minus exports.
• C) The purchase of a new home is treated as investment.
• D) Consumption is spending by firms and households on new capital.

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Definitions:

Labor Force

Refers to the total number of people, including both the employed and the unemployed, who are currently available to engage in the production of goods and services in an economy.

Entrepreneurs

Individuals who start, organize, manage, and assume the risk for a business venture.

Risky Activities

Actions or endeavors that involve a significant chance of loss or failure, often assessed in financial, business, or recreational contexts.

Profits

Income achieved when the total revenue from a business endeavor is greater than the expenses, costs, and taxes involved in supporting the endeavor.