The farmer pays 20 cents for the seed that is sold to the miller for 35 cents; the miller makes flour and sells it to the baker for 55 cents. The baker makes bread and sells it to the grocery store for 80 cents and the store sells it to consumers for $1.00. The contribution to Gross Domestic Product (GDP) is
a. $1
b. $2
c. $3
d. $4
Ans: a. $1
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The argument that developing countries should nurture their infant domestic industries by protecting them from foreign competition is known as
A) the infant industry argument. B) the escape clause hypothesis. C) preservation of the home market. D) institutional fair trade policy.
The Congress of Industrial Organization (CIO) was founded by
A) Samuel Gompers. B) Jimmy Hoffa. C) John L. Lewis. D) George Meany.
Which of the following may NOT help avoid a financial crisis?
A) Maintaining credible and sustainable fiscal policies B) Regulation and supervision of the financial system C) Immediately bailing out financial intermediaries and standing ready to bail out others in case a financial crisis occurs D) Maintaining credible and sustainable monetary policies
Mainstream and new classical views are compatible perspectives on macroeconomic issues and policies. Do you agree? Explain.
What will be an ideal response?