Refer to the Accompanying Data

question 223

Multiple Choice

$$\begin{array} { | l | r | } \hline \text { Gross Private Domestic Investment } & \$ 46 \\\hline \text { Exports of the U.S. } & 9 \\\hline \text { Disposable Income } & 190 \\\hline \text { Personal Saving } & 10 \\\hline \text { Government Purchases } & 84 \\\hline \text { Net Foreign Factor Income } & 10 \\\hline \text { Consumption of Fixed Capital } & 52 \\\hline \text { Dividends } & 13 \\\hline \text { Imports of the U.S. } & 12 \\\hline \text { Taxes on Production and Imports } & 22 \\\hline \text { Personal Taxes } & 38 \\\hline \text { Social Security Contributions } & 23 \\\hline \text { Statistical Discrepancy } & 0 \\\hline\end{array}$$ Refer to the accompanying data. All ?gures are in billions of dollars. The economy characterized by the data is

• A) experiencing in?ation because disposable income exceeds personal income.
• B) experiencing declining production capacity because net investment is negative.
• C) in a depression because personal income exceeds disposable income.
• D) experiencing expanding production capacity because net private domestic investment is positive.

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Definitions:

Default Risk

The likelihood that a borrower will be unable to make required debt payments.

Qualitative Factors

Non-numeric considerations that influence decision-making, such as company reputation, brand strength, or employee morale.

Financial Ratios

Metrics derived from financial statements that are used by analysts to evaluate a company's financial health or performance.

Yield To Maturity

The total return anticipated on a bond if held until it matures, including all payments of principal and interest, measured as an annual rate.