Comparisons of per capita gross domestic product across countries provide a very good measure of how similar living standards are across countries.
Answer the following statement true (T) or false (F)
False
Per capita GDP is of limited usefulness in international comparisons because it measures only market activities and because prices vary from country to country.
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Starting from long-run equilibrium, a large decrease in government purchases will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; lower; potential B. expansionary; higher; potential C. recessionary; lower; potential D. recessionary; lower; lower
If the demand for labor is unchanged, population growth will increase the supply of labor and increase the equilibrium wage
Indicate whether the statement is true or false
If a monopoly's demand curve shifts to the right, the monopoly
A) will charge a higher price. B) will charge a lower price. C) will sell more. D) decision cannot be determined.
Related to the Economics in Practice on page 102: Harriet runs a corner delicatessen and one day decides to raise her prices by 20 percent. Total revenue is likely to ________ when she first raises prices since demand is relatively ________ in the short term.
A. rise; inelastic B. rise; elastic C. fall; elastic D. fall; inelastic