Consumption is $7 trillion, investment is $1.5 trillion, government expenditures are $2 trillion, government transfer payments are $1 trillion, exports are $1.50 trillion and imports are $1.25 trillion. What is GDP?
GDP = C + I + G + NX = $7 trillion + $1.5 trillion + $2 trillion + $1.5 trillion - $1.25 trillion
= $10.75 trillion
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A) shrinks thanks to the budget surplus. B) grows to finance the budget deficit. C) shrinks thanks to the budget deficit. D) grows to finance the budget surplus. E) does not change because it has nothing to do with government outlays and tax revenue.
In the case study discussed in the chapter, the electronics firm was actually enhancing its profits by selling calculators at a price that was below average cost.
Answer the following statement true (T) or false (F)
Dead capital is
A. useful only if employed in a labor-intensive production process. B. unlikely to have any productive use. C. useful only if employed in a capital-intensive production process. D. unlikely to be applied to its most efficient use.
The basic function of advertising, according to its proponents, is to assist consumers in making informed, rational choices.
Answer the following statement true (T) or false (F)