Which of the following would be counted in U.S. GDP?
a. the purchase of an old house
b. the purchase of a new textbook
c. the purchase of a $1,000 government savings bond
d. washing your car in the driveway
e. the purchase of 50 shares of IBM stock
B
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Rent seeking is the act of obtaining special treatment by ________ to create ________
A) a monopoly; consumer surplus B) the government; economic profit C) consumers; a monopoly D) the government; consumer surplus E) competitive producers; a monopoly
The opportunity cost of production differs from an accounting definition of a firm's costs because it includes
a. expenditures the firm undertakes for research and development. b. the opportunity cost of assets and financial resources owned by the firm. c. the direct monetary cost of purchasing resources. d. the firm's revenue as a cost.
Donald produces nails at a cost of $350 per ton. If he sells the nails for $500 per ton, his producer surplus is
a. $150. b. $350. c. $500. d. $850.
If an explanatory variable is strictly exogenous it implies that:
A. changes in the lag of the variable does not affect future values of the dependent variable. B. the variable is correlated with the error term in all future time periods. C. the variable cannot react to what has happened to the dependent variable in the past. D. the conditional mean of the error term given the variable is zero.