Which of the Following Would Count as an Investment Expenditure

question 209

Multiple Choice

Which of the following would count as an investment expenditure in national income accounting?

• A) General Motors hires 10 electrical engineers.
• B) Boeing purchases a new metal stretching machine used to produce airplane wings.
• C) Ms. Quantum buys 100 shares of Microsoft stock.
• D) A large corporation spends $10,000 per month on long-distance phone charges.

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Definitions:

Automobiles

Wheeled vehicles powered by engines, primarily used for personal transportation.

Breakfast Cereals

Manufactured food products made from processed grains that are often eaten as the first meal of the day.

Recession

A short-term downturn in the economy characterized by decreased trade and industrial production, typically marked by a decline in gross domestic product (GDP) for two consecutive quarters.

Employment

Employment refers to the condition of having paid work or the relationship between an employer and an employee who performs work or services for compensation.