A Factory in Techland Could Not Sell 20 Percent of Its

question 209

Multiple Choice

A factory in Techland could not sell 20 percent of its output during a certain year due to a decrease in the demand for its product.Which of the following would be true if it produced 20 percent less?

• A) Techland's GDP for that year would have been higher.
• B) Techland's GDP would have remained the same.
• C) Techland's GDP for that year would have been lower.
• D) Techland's income per capita for that year would have been higher.

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Definitions:

Financial Ground

The state of financial stability or condition of an individual or organization.

Operating Lease

A lease agreement for short-term leasing of assets without transferring ownership rights.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, providing a basis for computing rates of return and evaluating its capital structure.

Financial Lease

A type of lease wherein the lessee has possession and control of an asset during its significant life but does not own the asset, effectively treating it as a loan with asset as collateral.