Which of the Following Assumptions Is Usually Made About Government

question 66

Multiple Choice

Which of the following assumptions is usually made about government purchases?

• A)They vary directly with the interest rate.
• B)They are autonomous.
• C)They vary directly with the level of income.
• D)They equal the level of net taxes in equilibrium.
• E)They vary inversely with the level of income.

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Definitions:

Raw Materials

the unprocessed or minimally processed resources used to manufacture finished goods, such as metals, plastics, or textiles.

Retained Earnings

Cumulative net income of a company that is retained within the business rather than distributed to shareholders as dividends.

Cost of Goods Sold

The total cost directly associated with producing goods, including materials and labor expenses, that a company sells during a specific period.

Collections

The process of recovering amounts owed to a business by its debtors or customers.