Which of These Was NOT a Response by the Government

question 85

Multiple Choice

Which of these was NOT a response by the government to mitigate the effects of the financial crisis?

• A) It made large loans to the U.S. automobile industry.
• B) It lent over $100 billion to Lehman Brothers to keep it from bankruptcy.
• C) It engaged in quantitative easing programs to remove risky assets from bank balance sheets.
• D) It passed a very large stimulus package to boost aggregate demand.

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Definitions:

Absorption Costing

An accounting method that incorporates all direct and indirect manufacturing costs into the cost of a product.

Net Profit

The total earnings of a company after subtracting all expenses, including taxes and operating costs, from its total revenues.

Variable Manufacturing Costs

Expenses that fluctuate with production output levels, including raw materials, direct labor, and utility costs directly involved in the manufacturing process.

Predetermined Fixed Overhead

A budgeted or estimated amount of fixed overhead costs, used to allocate overhead costs to products or services.