Which of the Following Restrictions Implies That Investment Exceeds Private

question 48

Multiple Choice

Which of the following restrictions implies that investment exceeds private saving for a closed economy?

• A)The economy has no government.
• B)The economy's government is running a budget deficit.
• C)The economy's government is running a budget surplus.
• D)No restriction is necessary;investment and private saving are equal for all closed economies.

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Definitions:

Assets And Liabilities

Resources owned and controlled by a business (assets) and obligations to transfer resources to another entity (liabilities).

Current Rate Method

An accounting technique used in currency translation where assets and liabilities are converted at the current exchange rate.

Exchange Rates

The value of one currency for the purpose of conversion to another, indicating how much one currency can be exchanged for another currency.

Functional Currency

The primary currency of the primary economic environment in which the entity operates, usually the local currency or the currency of the primary sales market.