We Are MOST Likely to See a Recession If Interest

question 25

Multiple Choice

We are MOST likely to see a recession if interest rates on long-term bonds are _____, and interest rates on short-term bonds are _____.

• A) 8%; 6%
• B) 5%; 5%
• C) 7%; 7%
• D) 2%; 4%

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Definitions:

Accounting Income

It is the income reported by a company as per the accounting principles, including all revenues minus expenses, excluding any unrealized gains or losses.

Adjustments

Modifications made to financial statements or data to correct inaccuracies or allocate revenues and expenses.

Free Cash Flow

The cash a company generates after accounting for cash outflows to support operations and maintain its capital assets, indicating the financial health and profitability of a company.

EBIT

Earnings Before Interest and Taxes, a measure of a company's operating performance that excludes interest and income tax expenses.