Which of the Following Explains Why Fluctuations in Real GDP

question 163

Multiple Choice

Which of the following explains why fluctuations in real GDP have become less volatile in the United States since 1950?

• A)Services have become a smaller fraction of GDP since the 1950s.
• B)Unemployment insurance and other government transfer programs are more prevalent since the 1950s.
• C)The government has become more reluctant to intervene when real GDP declines and unemployment rises since the 1950s.
• D)both B and C

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Definitions:

Reversals

Accounting actions undoing previous recognitions, such as reversing an expense or revenue recorded in earlier accounting periods.

Other Comprehensive Income

Income that is not included in net income and includes items that are not realized or not a result of daily operations, such as foreign currency translation adjustments.

Revaluation Method

An accounting technique that involves adjusting the book value of an asset to reflect its current fair market value.

Intangible

Assets that lack physical substance but have value due to their intellectual property or other non-physical qualities, such as patents, trademarks, and goodwill.