Economic Theories

question 3

Multiple Choice

Economic theories:

• A) express normative values.
• B) invent imaginative and interesting stories.
• C) use the fallacy of composition to validate hypotheses.
• D) predict cause and effect in the real world.
• E) use only perfect and complete information to formulate and test hypotheses.

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Definitions:

Salaries

Payments made to employees for their services, typically expressed as an annual sum and paid at regular intervals.

Investing Activities

Financial activities related to the purchase and sale of long-term assets or investment securities, impacting a company's cash flow.

Financing Activities

Transactions involving raising capital and repaying investors, including debt, equity, and dividend payments as part of a company's cash flow.

Operations

Activities involved in the day-to-day running of a business for the purpose of producing value for the stakeholders; involves management of resources, production, and distribution of goods and services.