The Decline in Investment Due to an Increase in Government

question 166

True/False

The decline in investment due to an increase in government purchases is called crowding out.

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Definitions:

Goodwill

When a business is purchased, the difference between the price paid and the fair value of the net assets is goodwill. Goodwill may depend on brand names, business location, service, or other elements; it is a valuable asset that plays an important part in the expected rate of future earnings of a business.

Natural Resource

Refers to resources found in nature that are used for economic gain, such as minerals, forests, water, and land.

Depletion

Amount of natural resources that has been exhausted by mining, pumping, and so forth for a period of time.

Patent

A legal right granted by the government to an inventor, giving them exclusive rights to make, use, sell, and import an invention for a certain period of time.