Which of the Following Does Not Constitute an Act of "Investment

question 130

Multiple Choice

Which of the following does not constitute an act of "investment" as economists use the term?

• A) The city council authorizes the construction of a new fire station.
• B) A retiree buys 50 shares of stock at $10 a share and then sells the stock at a profit for $20 a share.
• C) An accountant attends a seminar on changes in the federal tax code.
• D) A department store increases its inventory of football jerseys before the Super Bowl.

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Definitions:

Partnership Agreement

A formal arrangement between two or more parties to manage and operate a business and share its profits or losses in accordance with the terms set out in the agreement.

Bylaws

Internal rules adopted by an organization or corporation to govern its actions and decisions.

Financial Manager

A professional responsible for managing an organization's financial health by planning, directing, and controlling financial activities.

Secondary Market

The secondary market is where previously issued financial instruments such as stocks and bonds are bought and sold, as opposed to their initial issuance in the primary market.