Gross Domestic Product (GDP) figures may understate the value of goods and services due to
A. the exclusion of the underground economy.
B. the inclusion of legal non-reported, non-taxed income.
C. the inclusion of household production.
D. the exclusion of the value of stocks.
Answer: A
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What occurs in the second stage of economic development?
A) Most of the labor force works in agriculture. B) The service sector comes to the forefront. C) The manufacturing sector declines in importance. D) Manufacturing gains in importance and employs a large portion of the labor force.
Farmers rotate their crops between corn and soybean to increase crop yields. This behavior exhibits
a. Economies of scale b. Economies of scope c. Diseconomies of scale d. Diseconomies of scope
As the market price decreases, the slope of the total revenue curve of a perfectly competitive firm becomes steeper
a. True b. False Indicate whether the statement is true or false
The economic argument for legalizing drugs:
a. takes into consideration all the externalities associated with drug use. b. shows that economists are all libertarians at heart. c. is based on the assumption that for most non-users, the demand is relatively price elastic. d. is really politically motivated. e. is morally bankrupt.