Identify the Main Reason to Expect Convergence in the Long

question 131

Multiple Choice

Identify the main reason to expect convergence in the long run.

• A)Low-productivity countries learning from high-productivity countries
• B)Rapid growth in the supply of capital in low-productivity countries
• C)Educational attainment rising quickly in low-productivity countries
• D)Economic complacency and mismanagement in high-productivity countries

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Definitions:

Eliminate Intra-entity Transfer

A consolidation procedure that removes transactions between entities within the same corporate group to avoid double counting in consolidated financial statements.

Equity Method

An accounting technique used to assess the profits earned by a company through its investment in another company, by reporting the income based on the investee's net income and changes in equity.

Eliminate Unrecognized

A process in accounting to remove unrealized gains or losses from the books, often in the context of consolidation accounting to avoid double counting.

Intra-entity Gross Profit

The profit realized from transactions conducted within different divisions or segments of the same company, often eliminated in consolidated reporting.