Economists began carefully calculating GDP
a. simply because the data was available
b. to determine the contribution of specific firms to the economy
c. as a result of the problems during the Great Depression
d. to make sure that firms were being productive
e. to gain insight into the causes of unemployment
C
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"In the long run, a perfectly competitive firm's average total cost is always below the market clearing price." Agree or disagree? Why?
What will be an ideal response?
In the principal-agent relationship, the principal is
A) the owner of a resource that has hired a third party to act in the best interest of that third party. B) the person who is placed in control over resources that are not his own, with a contractual obligation to use these resources in the interests of some other party. C) the person who is placed in control over resources that are not his own and agrees to compensate the resource owner in the event of outcomes that do not satisfy the resource owner. D) the person who places his resources in professional hands in exchange for the professional's promise to act on the resource owner's behalf.
Assume that Down Slope specializes in producing snow boards and Seven Seas specializes in producing scuba tanks. After trade, Down Slope exports 2,000 snow boards and imports 400 scuba tanks. The terms of trade
A. are 1:5 snow boards to scuba tanks. B. are 1/5:1 snow boards to scuba tanks. C. are 5:1 snow boards to scuba tanks. D. cannot be determined from this information.
In the cause-effect chain linking changes in the banks' excess reserves and the resulting changes in output and employment in the economy:
A. A decrease in aggregate demand will increase output B. An increase in the money supply will decrease the rate of interest C. A decrease in excess reserves will increase the money supply D. A decrease in the rate of interest will decrease aggregate demand