To approximate net annual cash flow, depreciation is
A. Added back to net income because it is an inflow of cash
B. Subtracted from net income because it is an expense
C. Subtracted from net income because it is an outflow of cash
D. Added back to net income because it is not an outflow of cash
Answer: D. Added back to net income because it is not an outflow of cash
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Net exports of goods and services equal the
A) exports of goods and services divided by the imports of goods and services. B) exports of goods and services plus the imports of goods and services. C) exports of goods and services minus the imports of goods and services. D) imports of goods and services minus the exports of goods and services.
When comparing the price of a tablet with the price of a laptop, Amanda discovered the tablet was more expensive. This is an example of using money as
A) a store of value. B) a medium of exchange. C) a unit of accounting. D) a standard of deferred payment.
Which of the following examples, ceteris paribus, would lead to a change in investment that would shift that nation’s aggregate demand curve?
a. Argentina’s government builds new highways. b. Portugal experiences a bout of high price levels. c. Spain’s government raises taxes on businesses. d. Mexico experiences high consumer debt levels.
Which of the following statements about the national debt has the most validity?
A. Our large national debt can bankrupt the nation. B. If only Americans hold the debt, then payments of interest and principal are simply transfers from some Americans to other Americans. C. Our large national debt can lead to subjection by the people (especially foreigners) who hold the debt. D. The national debt represents a burden to future generations who will have to make huge payments of interest and principal.