Changes in Government Spending

question 67

Multiple Choice

Changes in government spending

• A)are an indirect component of the expenditures schedule.
• B)have a different multiplier effect than changes in business investment spending.
• C)are a direct component of the expenditures schedule and have the same multiplier effect as changes in business investment spending.
• D)do not have an effect on spending if they are matched by tax changes.

---

Definitions:

Capital Account

A financial statement account that represents the ownership interests or equity in a company.

Closed

In accounting, this term refers to accounts that have been concluded for a period, typically at the end of an accounting cycle, by transferring their balances to permanent accounts.

Service Revenue

Income earned by a company from the services it provides to customers, as opposed to selling goods.

Equipment

Tangible assets used in operations, such as machinery and computers, that have a useful life beyond one year.