Generally Speaking,what Is the Smallest Component of Aggregate Spending

question 182

Multiple Choice

Generally speaking,what is the smallest component of aggregate spending?

• A)Net exports.
• B)Investment.
• C)Government purchases of goods and services.
• D)Consumption.
• E)Wages,interest,rents and profits.

Understand the process and importance of adjusting entries in financial statements.

Calculate financial transactions using the accrual basis of accounting.

Identify and record transactions in appropriate journals.

Distinguish between cash basis and accrual basis of accounting.

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Definitions:

Support Price

A price level set by governments in order to stabilize or increase prices of specific goods by buying up the supply or providing subsidies.

Demand Curve

A graphical representation showing the relationship between the price of a good and the amount of that good consumers are willing to buy.

Support Price

A price level set by governments in order to maintain the market price of a good or service at a particular minimum level to protect producers.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service versus what they actually pay, measuring the benefit to consumers from participation in the market.