Which of the Following Statements Regarding Exogenous and Endogenous Variables

question 57

Multiple Choice

Which of the following statements regarding exogenous and endogenous variables is correct?

• A)The set of exogenous variables in any economic model should take into account the rich detail of the world and so should be limitless.
• B)Endogenous variables will always be determined within the model.
• C)Exogenous variables change as a result of changes in endogenous variables.
• D)The only variables that are relevant to the market equilibrium are the endogenous variables, as they are determined within the model.

---

Definitions:

Cost Method

An accounting technique used to value an investment, where the investment is recorded at its acquisition cost without adjustment for market changes.

Dividends

Payments made by a corporation to its shareholders, usually derived from the company's profits, representing a portion of the earnings allocated for distribution.

Net Income

The total profit of a company after all expenses, including taxes and operational costs, have been deducted from total revenue.

Cost Method

Cost Method is an accounting methodology for investment, where the investment is recorded at its acquisition cost without considering dividends or changes in market value.