Which of the Following Statements Is Correct with Regards to the Business

question 2

Multiple Choice

Which of the following statements is correct with regards to the business cycle?

• A)Up to the 1980s the economy slowly got back to its previous level of employment.
• B)After the 1980s economic recoveries took increasingly longer.
• C)After the 1980s economic recoveries took a short period of time.
• D)The 1990 recovery was slower than the 2001 recovery.

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Definitions:

Insolvent

A firm is technically insolvent when it can’t pay its short-term debts. Legal insolvency implies the firm’s liabilities exceed its assets.

Liabilities

Financial obligations or debts that a company owes to others, such as loans, accounts payable, and mortgages.

Assets

Economic resources owned or controlled by a business or individual, expected to produce future economic benefits.

Leveraged Buyout

The acquisition of another company using a significant amount of borrowed money (bonds or loans) to meet the cost of acquisition.