As Real GDP Decreases

question 24

Multiple Choice

As real GDP decreases,

• A)induced consumption decreases.
• B)planned investment increases.
• C)exports increase.
• D)imports increase.
• E)induced consumption increases.

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Definitions:

Straight-Line Depreciation

A technique for apportioning the price of a physical asset over its effective duration in steady annual portions.

Salvage Value

The expected salvage value of an asset after it has served its useful life.

Service Life

The expected period during which an asset remains usable, functional, or productive before it requires replacement or major repair.

Capitalize Interest

The process of adding the cost of interest on a loan to the balance of the loan instead of paying it out.