The reporter on one broadcast network says 2011 GDP increased to an all-time high. Commenting on the same figure, a second reporter says GDP in 2011 was less than in 2010 . Which of the following explanations is consistent with the statements of both reporters?
a. The first reporter was referring to real GDP, and the second was referring to nominal GDP.
b. The first reporter was referring to nominal GDP, and the second was referring to real GDP.
c. The first reporter was referring to GDP as measured by the expenditure approach, and the second was referring to GDP as measured by the income cost approach.
d. The first reporter was referring to GDP as measured by the income cost approach, and the second was referring to GDP as measured by the expenditure approach.
B
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In the last few decades, tariffs have:
A. risen by more than 20 percent in developing countries. B. fallen by more than 20 percent in developing countries. C. risen more in developing nations than in developed countries. D. risen more in developed nations than in developing countries.
Answer the following questions true (T) or false (F)
1. The mercantilist philosophy argues that nations can become rich and powerful by exporting more than they import. 2. Comparative advantage states that a nation will export the foods that it can produce more cheaply than others and import goods that other nations can produce more cheaply. 3. Opportunity costs reflect the cost of a good as measured by the amount of a second good that must be given up in order to produce one additional unit of the first good.
Suppose that output in an economy is 1,000 units and the number of hours worked in the economy is 40. If the economy enters a recession, which of the following combinations of output and hours worked would best reflect the recession?
A. 800 units of output and 30 hours worked B. 1,000 units of output and 40 hours worked C. 500 units of output and 20 hours worked D. 600 units of output and 25 hours worked
Answer the following statements true (T) or false (F)
1. Marginal utility is the accumulation of the total utility from successive units of a good or service consumed. 2. The law of diminishing marginal utility suggests that the total utility that a consumer derives from a product will increase slower and slower as more of the product is consumed. 3. If total utility increases as consumption of a good increases, then marginal utility must be increasing also. 4. With diminishing marginal utility, if a consumer reduces her consumption of a good, then her marginal utility from that good would increase. 5. The price of chicken = 5 while the price of pork = 9. If, after spending her entire budget, the consumer has MU of chicken = 6 while the MU of pork = 12, then the consumer should have bought more chicken and less pork in order to increase his total utility.