In What Category Is the Purchase of a Computer by a Business

question 170

Multiple Choice

In what category is the purchase of a computer by a business in national income accounting?

• A)It is ignored because computers are considered intermediate goods-an input in the production of other goods and services
• B)It is considered consumption
• C)It is a form of investment spending
• D)It is a form of savings

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Definitions:

Exercise Price

The price at which the holder of an option can buy (call) or sell (put) the underlying security or commodity.

Option Prices

The cost to purchase an option, which gives the holder the right, but not the obligation, to buy or sell an asset at a specified price before a particular date.

Asian Put Option

A type of put option where the payoff depends on the average price of the underlying asset over a certain period rather than its price at expiration.

Underlying Asset

An asset such as a stock, bond, commodity, or currency on which a derivative's price is based.