Consumption, as a component of GDP:
A. measures spending on goods and services by individuals and households.
B. includes nondurable goods only.
C. includes durable goods only.
D. measures spending only on goods, not services, by private individuals and households.
A. measures spending on goods and services by individuals and households.
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Refer to the scenario above. The opportunity cost per dollar of value added in the production of Good X by worker 1 is ________
A) $0.50 of value added in the production of Good Y B) $100 of value added in the production of Good Y C) $87.50 of value added in the production of Good Y D) $0.70 of value added in the production of Good Y
The United States produces both automobiles and computers more efficiently than Mexico. Nevertheless, it is possible that both nations would benefit from trade in these items. The reason for this is
A. the law of comparative advantage. B. the inflation-unemployment trade-off. C. externalities. D. the cost disease of personal services. E. attempts to repeal the law of supply and demand.
Figure 4-21
Refer to . How much tax revenue does this tax produce for the government?
a.
$480
b.
$600
c.
$800
d.
$1,080
An inferior good is a good
A. that consumers purchase more when their incomes are higher. B. of high quality. C. that has low quality. D. that consumers purchase less of when their incomes are higher.