Which Action Taken by a Worker Would Not Be an Investment

question 33

Multiple Choice

Which action taken by a worker would not be an investment in human capital?

• A) enrolling in college
• B) enrolling in trade school
• C) purchasing exercise equipment
• D) purchasing stock in a pharmaceutical company

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Definitions:

Direct Method

The direct method is a way of preparing cash flow statements where actual cash flows from operating activities are reported instead of adjustments from net income.

Direct Approach

A method used in accounting that focuses on the immediate recognition of revenues and expenses when they are incurred, without adjusting for accruals.

Indirect Approach

A method used in the preparation of the cash flow statement where net income is adjusted for non-cash transactions and changes in working capital.

Investing Activities

Financial transactions related to the acquisition and disposal of long-term assets and other investments not included in cash equivalents.