Which of the Following Is Investment,according to an Economist

question 46

Multiple Choice

Which of the following is investment,according to an economist?

• A)The purchase of U.S.savings bonds.
• B)A collection of rare coins.
• C)An increase in business inventories.
• D)The purchase of a new family car.

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Definitions:

Effective Rate

The actual interest rate that a borrower pays or earns, taking into account the compounding of interest.

Contract Rate

The pre-agreed interest rate specified in a financial contract or loan agreement.

Bond Premium

The additional amount over the face value for which a bond is sold, representing the difference between its selling price and its face value.

EPS

Earnings Per Share, a financial ratio indicating the amount of profit attributed to each outstanding share of common stock, used to gauge a company's profitability.