Real Assets Are Created By

question 59

Multiple Choice

Real assets are created by:

• A)government intervention.
• B)real economic activity, such as the construction of a house.
• C)the agreement by individuals to exchange financial assets for financial liabilities.
• D)borrowing and lending.

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Definitions:

Cost Structure

The composition of a company’s costs, including fixed and variable costs, which impacts its profitability and pricing strategy.

Variable

A variable is an element, feature, or factor that is liable to vary or change; in business, it often refers to costs that fluctuate with the level of production or sales.

Fixed

Pertains to costs that remain constant regardless of the level of production or sales, such as rent, salaries, and insurance.

Fixed Costs

Costs that remain constant regardless of the amount of goods produced or sold within a specific timeframe, including rent, salaries, and insurance premiums.