Which of the following activities is excluded from GDP, causing GDP to understate a nation's production?
A. The services of health care workers
B. The services of military personnel
C. Goods and services produced in the underground economy
D. The construction of new buildings
Answer: C
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Letters are used to represent the terms used to answer this question: price (P), quantity of output (Q), total cost (TC) and average total cost (ATC). Which of the following equations is equal to a firm's profit?
A) P - ATC B) (P × Q) - (P × ATC) C) P - TC D) (P × Q) - TC
Certain goods are related so that an increase in the price of one good decreases the demand for the other. These goods are: a. complements
b. substitutes. c. luxury goods. d. competing goods.
Under a gold standard, if the market price of gold is below the official price of gold (set by the monetary authority) members of the public would likely buy gold _______________ and sell it __________________, causing the market price of gold to ____________________
A) from the monetary authority; in the gold market; fall B) from the monetary authority; in the gold market; rise C) in the gold market; to the monetary authority; fall D) in the gold market; to the monetary authority; rise
Consumers will switch to another good when ______ drops too low.
a. consumer choice b. the economy c. marginal utility d. total utility