Which of the following statements is FALSE?
A. Private transfer payments, such as an inheritance, are included in the Gross Domestic Product (GDP).
B. If statisticians counted intermediate goods, the estimate of Gross Domestic Product (GDP) would be too high.
C. Transfers of used goods are not included in Gross Domestic Product (GDP).
D. Gross Domestic Product (GDP) measures the market value of final goods and services produced during a particular time period.
Answer: A
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Tommy's Teddy Bears incurs $300,000 per year in explicit costs and $50,000 in implicit costs. The shop earns $600,000 in revenues and has $1.1 million in net worth. Based on this information, what is accounting profit for Tommy's Teddy Bears?
A) $250,000 B) $300,000 C) $500,000 D) $1.35 million
If you own a $1,000 face value bond with one year remaining to maturity and a 3 percent coupon rate and new bonds are paying 14 percent, what is the most you can get for your old bond?
A) $903.51 B) $997.19 C) $1,000 D) $1,140
The Federal Reserve was originally created to
a. stabilize exchange rates b. keep the unemployment rate at 0% c. create jobs d. issue bonds e. create and regulate the U.S. money supply
The automobile market is an example of a perfectly competitive market
a. True b. False