-After Examining Figure 8-3,it Is Possible to Conclude That

question 22

Multiple Choice

-After examining Figure 8-3,it is possible to conclude that

• A) people do not save money nor pay taxes in this model
• B) firms purchase resources from households and other firms in this model
• C) households are the only ones who purchase and firms the only ones who sell in this model
• D) completion of a sale represents a break in the flow of goods and services,and inputs in this model
• E) all households and firms individually receive the same amount of money in this model

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Definitions:

Fair Market Value

The price at which an asset would trade in a competitive auction setting.

Income Statement

A financial statement that shows a company's revenues, expenses, and net income over a specific period.

Goodwill

An intangible asset created when one company purchases another for a price higher than the combined value of its physical and recognizable intangible assets.

Purchase Accounting Method

An accounting approach used in mergers and acquisitions, where the assets and liabilities of the acquired company are added to the acquirer's balance sheet at their current fair market values.