National Defence Is a Classic Example of a Public Good

question 21

Multiple Choice

National defence is a classic example of a public good because:

• A) it is provided by the government
• B) private security forces would make too much money
• C) everyone agrees that some level of national defence is important
• D) too many people would be free-riders if private security forces tried to provide it

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Definitions:

Trading Portfolio

A collection of financial assets held by an individual or institution primarily for the purpose of short-term trading and profit.

Fair Value

Fair value is an estimation of the price at which an asset or liability could be bought or sold in an orderly transaction between market participants at the measurement date.

Adjusting Entry

A journal entry made at the end of an accounting period to allocate income and expenditures to the appropriate period, ensuring that revenues and expenses are matched.

Short-Term Investments

Investments that are expected to be converted into cash, sold, or consumed within a year or within one business cycle, whichever is longer.