In a Private Closed Economy, the Two Components of Aggregate

question 130

Multiple Choice

In a private closed economy, the two components of aggregate expenditures are:

• A) Consumption and government spending
• B) Consumption and net exports
• C) Consumption, investment, and net exports
• D) Consumption and investment

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Definitions:

Compounded Quarterly

A method of calculating interest where the interest earned on an investment is calculated four times a year and added to the principal sum, leading to interest calculations on interest in subsequent periods.

Future Value Factor

A formula used to determine the future value of an investment based on its current value and rate of return.

Annuity

A fiscal instrument providing a constant flow of payments to a person, mainly serving as a source of income for individuals in retirement.

Periods

Intervals of time into which financial or operational activities are divided for reporting, planning, or analysis purposes.