Ryan lives in an apartment where he pays $7,000 a year in rent. Sarah lives in a house that could be rented for $21,000 a year. How much do these housing services contribute to GDP?
a. $21,000
b. $28,000
c. $7,000
d. $14,000
b
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Use the following table showing the consumption schedule for an economy to answer the next question. All figures are in billions of dollars.RGDPConsumption$440$450490490540530590570640610Given a level of investment and government expenditures totaling $30 billion, zero net exports, and a lump-sum tax of $30 billion, a reduction of government expenditures of $20 billion at each level of real GDP will result in an equilibrium real GDP of
A. $490 billion. B. $590 billion. C. $640 billion. D. $540 billion.
Given the demand curve in Figure 5-24, explain how consumer’s surplus is calculated.
What will be an ideal response?
A monopolistic competitor faces a horizontal demand curve.
Answer the following statement true (T) or false (F)
Which of the following is not a question addressed by macroeconomists?
a. Why is average income high in some nations but low in others? b. What, if anything, can the government do to promote growth in incomes, low inflation, and stable employment? c. What is the impact of foreign competition on the U.S. auto industry? d. Why do production and employment expand in some years and contract in others?