Which of the Following Statements About a Not-For-Profit Firm's Fund

question 1

Multiple Choice

Which of the following statements about a not-for-profit firm's fund capital is most correct?

• A) Fund capital is equivalent to equity capital in investor-owned firms.
• B) The sole source of fund capital is the excess of revenues over expenses.
• C) Fund capital has a zero opportunity cost.
• D) Fund capital can only come from donations.
• E) Fund capital does not change over time.

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Definitions:

Economic Fluctuations

Variations in the level of economic activity in an economy over a period of time, including phases of expansion and contraction.

Business Cycle

The fluctuations in economic activity that an economy experiences over a period of time, characterized by periods of expansion (growth) and contraction (recession).

Recessions

Intervals of provisional economic contraction, during which commerce and industry slow down, often indicated by a dip in GDP across two sequential quarters.

Real GDP

The measure of a country's economic output adjusted for price changes (inflation or deflation), reflecting the true value of goods and services produced.