Which of the Following Likely Occurs When Households and Firms

question 32

Multiple Choice

Which of the following likely occurs when households and firms become more pessimistic?

• A)increased spending,increased aggregate demand,rising real GDP,and a rising unemployment rate
• B)decreased spending,increased aggregate demand,rising real GDP,and a falling unemployment rate
• C)decreased spending,decreased aggregate demand,falling real GDP,and a rising unemployment rate
• D)decreased spending,decreased aggregate demand,falling real GDP,and a falling unemployment rate

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Definitions:

Premiums Paid

Amounts paid for insurance coverage or policies over a specified period.

Unexpired Insurance

The portion of an insurance premium that has not yet been used up or has not yet expired, representing a future economic benefit.

Insurance Policy

A contract between an insurer and a policyholder in which the insurer agrees to compensate the policyholder for specific losses in exchange for a premium.

Adjusting Entry

A journal entry made at the end of an accounting period to record unpaid expenses or revenues that have accrued, ensuring the accounts reflect the true financial position.