The Theory of Economic Fluctuations Tells Us That the Spending

question 36

Multiple Choice

The theory of economic fluctuations tells us that the spending shocks on the Japanese economy as a result of the earthquake in March 2011,

• A)were aggravated because of feedback effects.
• B)were lessened because of feedback effects.
• C)should have no effect on the economy.
• D)should only have affected big cities in Japan.
• E)should not have created any feedback effects.

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Definitions:

Debt-To-Equity Ratio

An indicator measuring the balance between financing a company's assets through shareholders' equity and debt.

Balance Sheet

The balance sheet is a financial statement that shows a company's assets, liabilities, and shareholders' equity at a specific point in time.

Income Statement

is a financial statement that shows a company’s revenues, expenses, and profits over a specific period, providing insight into its profitability.

Debt-To-Equity Ratio

A ratio assessing the comparative contribution of debt and shareholder equity in the capital structure used for a company's assets.