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:

Hindsight Bias

The tendency to believe, after learning an outcome, that one would have foreseen it, also known as the "I-knew-it-all-along" effect.

Overestimate

To assess something as greater, larger, or more important than it actually is.

Predicted

Expected or forecasted based on current data or trends.

Mental Set

A tendency to approach situations in a certain way because that method worked in the past.