A country reports that its actual real GDP is greater than its potential GDP. It must be that
A) more workers decided to quit work in order to enjoy leisure time.
B) the excess by which real GDP exceeds potential GDP is only temporary, and eventually real GDP will decrease to be equal to potential GDP.
C) the price level is increasing.
D) an error was made when calculating actual real GDP.
E) None of the above answers is correct because it is impossible for a country's real GDP to exceed its potential GDP.
B
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Scarcity is only a temporary problem that a society can solve by promoting economic growth.
Answer the following statement true (T) or false (F)
When the price of a good rises, consumers buy a smaller quantity because of the ________ effect and the ________ effect
A) substitute; complement B) substitution; income C) normal; inferior D) supply; demand
When the price of a coupon bond increases,
A) the coupon rate declines B) the coupon rate increases C) the current yield declines D) the current yield increases
Other things constant, if both the benefits and costs of a public-sector activity are widespread among voters, the political process will generally result in the
a. rejection of productive activities and acceptance of unproductive activities. b. acceptance of both productive and unproductive activities. c. rejection of both productive and unproductive activities. d. acceptance of productive activities and rejection of unproductive activities.