Consumption Is $141 Billion, Planned Investment Is $15 Billion, and Saving

question 87

Multiple Choice

Consumption is $141 billion, planned investment is $15 billion, and saving is $15 billion in a private, closed economy.At this level,

• A)actual investment does not equal planned investment.
• B)there will be unplanned increases in inventories.
• C)there will be unplanned decreases in inventories.
• D)the economy is in equilibrium.

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Definitions:

Internal Control

A process designed by an organization's management and personnel to provide reasonable assurance regarding the achievement of effectiveness and efficiency of operations, reliability of financial reporting, and compliance with applicable laws and regulations.

Reasonable Assurance

A concept in auditing that suggests although not absolute, there is a high level of confidence in the financial statements accuracy.

Control Activities

Procedures and policies that are implemented by an entity to ensure that its directives are carried out, including safeguarding assets and preventing and detecting errors and fraud.

Errors And Fraud

Incorrect entries or intentional misstatements in financial statements, often leading to incorrect financial reporting.