Consider GDP Calculated According to the Expenditures Approach

question 26

Multiple Choice

Consider GDP calculated according to the expenditures approach.Which of the following components of GDP would need to decrease for GDP to increase?

• A)Imports
• B)Consumption
• C)Exports
• D)Investment
• E)Government spending

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Definitions:

Quick Ratio

A measure of a company's ability to meet its short-term obligations using its most liquid assets, calculated as (Current Assets - Inventory) / Current Liabilities.

Credit Risk

The risk of loss due to a borrower's failure to make payments on any type of debt.

FOB Destination

A shipping term indicating that the seller is responsible for the cost of transporting goods to the buyer's designated location; ownership transfers upon delivery.

Revenue

The total amount of money received by a company for goods sold or services provided during a certain time period.