If a German firm produces cars in the United States, that production should count towards Question 5 options:
A. German GDP.
B. U.S. GDP.
C. U.S. GNP.
D. both U.S. GNP and German GDP.
B. U.S. GDP.
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Consumers don't always have to pay the maximum price they are willing to pay
Indicate whether the statement is true or false
You have been promised a payment of $400 in the future. In which of the following cases is the present value of this payment the lowest?
a. You receive the payment 4 years from now and the interest rate is 4 percent. b. You receive the payment 4 years from now and the interest rate is 5 percent. c. You receive the payment 5 years from now and the interest rate is 4 percent. d. You receive the payment 5 years from now and the interest rate is 5 percent.
You love peanut butter. You hear on the news that 50 percent of the peanut crop in the South has been wiped out by drought, and that this will cause the price of peanuts to double by the end of the year. As a result,
a. your demand for peanut butter will increase, but not until the end of the year. b. your demand for peanut butter increases today. c. your demand for peanut butter decreases as you look for a substitute good. d. you will wait for the price of jelly to change before altering your demand for peanut butter.
A positive temporary supply side shock will:
A. increase the level of potential output in the long run. B. decrease the price level in the long run. C. increase the price level in the long run. D. have no effect in the long run.