Which Expenditure Item Is Responsible for the Decrease in Real

question 41

Multiple Choice

Which expenditure item is responsible for the decrease in real GDP during a recession?

• A) mostly investment spending
• B) mostly consumption spending
• C) mostly government spending
• D) mostly exports

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Definitions:

Expenses

Costs incurred in the process of earning revenues, typically categorized as operating or non-operating.

Owner's Drawings

Withdrawals made by the owner of a sole proprietorship or partnership from the business for personal use.

Revenues

The total income generated from the sale of goods or services related to a company's primary operations.

Adjusting Entries

Entries recorded in journals at the conclusion of an accounting period to assign revenues and costs to the time frame in which they were genuinely incurred.