Which of the Following Is Not an Economic Investment

question 27

Multiple Choice

Which of the following is not an economic investment?

• A)the purchase of machinery by ABC Manufacturing Company
• B)the purchase of 50 shares of Aliant by a retired business executive
• C)construction of a housing project for the homeless
• D)the increase in the inventory on a grocer's shelf

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Definitions:

Loan Covenants

Conditions set by lenders that borrowers must agree to and maintain to remain in compliance with the terms of the loan agreement.

Interest Payments

The payments made by a borrower to a lender for the use of borrowed money, typically expressed as an annual percentage of the principal.

Accounting-based Incentives

Incentives designed based on accounting figures and performance metrics to motivate employees or management toward specific behaviors.

Earnings Growth

An increase in a company's net income over a specified period, indicating financial health and profitability.