Which of the Following Is the Best Definition of Wealth

question 5

Multiple Choice

Which of the following is the best definition of wealth?

• A) The sum of all current and future income
• B) The total of all assets and all income
• C) The total of assets and income less any liabilities
• D) The sum of current income and the present value of future income

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Definitions:

Stock

A claim to partial ownership in a firm.

Net Exports

The value of a country's total exports minus its total imports, representing the net contribution of the export sector to a country's GDP.

Real Interest Rates

The interest rate adjusted for inflation, representing the true cost of borrowing and the real yield to an investor.

Net Capital Outflow

The difference between a country's total exports of capital and total imports of capital over a certain period, indicating how much capital is flowing out of the country in comparison to what is coming in.