In the Recession That Began in Late 2007 in the United

question 113

Multiple Choice

In the recession that began in late 2007 in the United States, which of the following was the first main element of GDP that faltered?

• A)consumption spending
• B)new home construction
• C)business spending on new equipment
• D)net exports

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Definitions:

Time Period Principle

An accounting principle stating that financial reporting should be done in regular intervals to ensure relevance and reliability.

Contra Account

An account used in an accounting system to offset a related account, commonly used to record depreciation, allowances, and discounts.

Normal Balance

The side of an account, either debit or credit, where increases to the account are recorded.

Accrued Expense

Expenses that have been incurred but not yet paid or documented in the financial statements through an accounting process.