During a war, governments will sometimes draft people, most of whom are presently employed, into the army. An economist, computing the real cost of the war, would be sure to include which of the following items?
a. the value of the civilian goods no longer produced by the new soldiers
b. the cost of feeding and clothing the new soldiers
c. the dollar cost of the payroll
d. the higher prices of civilian goods due to wartime shortages
e. the cost of transporting the soldiers to combat
A
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When analyzing how money affects income, we are analyzing the way in which a
a. stock affects another stock. b. stock affects a flow. c. flow affects another flow. d. flow affects a stock.
The demand curve facing a monopolistically competitive firm is generally
A. steeper than the demand curve that would face a perfectly competitive firm in the same industry. B. less elastic than the demand curve that would face a monopoly in the same industry. C. steeper and more elastic than the demand curve that would face a perfectly competitive firm in the same industry. D. flatter than the demand curve that would face a monopoly in the same industry.
If a natural disaster were to cause a negative long-run supply shock to the economy, once the economy adjusts, the new equilibrium will be at a:
A. higher price level and lower level of output. B. lower price level and lower level of output. C. higher price level and higher level of output. D. lower price level and higher level of output.
If autonomous investment decreases by $60 billion, equilibrium real GDP demanded will
What will be an ideal response?