What Does the Term Investment Refer to as Defined in National

question 68

Multiple Choice

What does the term investment refer to as defined in national income accounting?

• A)The spending by firms on new machinery and equipment.
• B)The value of all construction.
• C)The changes in business inventories from one year to the next.
• D)The spending by firms on new machinery and equipment,the value of all construction,and the changes in business inventories from one year to the next.

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Definitions:

Outward Shift

A movement of the supply or demand curve to the right, indicating an increase in supply or demand.

Resources Efficiently

The effective and optimal usage of resources to maximize productivity and minimize waste.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision or choosing to undertake an action.

Production Possibility Frontier

This graph illustrates the maximum outputs for two different goods achievable with certain inputs and existing production technology.