Gross Domestic Product is calculated by adding together
a. the number of goods and services produced in the economy.
b. money value of final goods and services.
c. number of workers employed in national production.
d. all commodities but not services produced in the economy.
b
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A rent ceiling controls the rent portion of the cost of housing but not the search cost. So when the search cost is ________ the rent, some people end up paying a ________ opportunity cost for housing than they would if there were no rent ceiling
A) added to; lower B) subtracted from; higher C) subtracted from; lower D) added to; higher E) equal to; lower
If Year 1 is the base year, the CPI for Year 2 is approximately
A) 100.0. B) 126.3. C) 131.3. D) 181.0.
Which of the following is NOT an example of moral hazard in business?
A) A bank buys risky mortgage securities because they believe the government will provide a bail-out if the investment performs badly. B) A firm uses venture capital to speculate in the commodity futures market. C) A firm does not hire adequate security protection for its warehouse after it pays for insurance on the property. D) Firms with the large debt problems are more likely to apply for bank loans than financially stable firms.
A budget constraint is:
A. a line that is composed of the additional utility gained from consuming possible combinations of goods and services that a consumer can buy with his or her income. B. a line that is composed of all the possible combinations of goods and services that a consumer can buy with his or her income. C. a line that is composed of all the possible combinations of goods and services that maximize a consumer's total utility. D. a line that is composed of the total utility gained from consuming all possible combinations of goods and services that a consumer can buy with his or her income.