Which approach to calculating GDP is especially useful in clarifying the resale of existing goods?
A. The income approach
B. The value-added approach
C. The expenditure approach
D. Any of these measurements will allow that kind of clarification equally well.
Answer: B
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Refer to Table 2-5. If the two countries specialize and trade, who should export cell phones?
A) Estonia B) They should both be importing cell phones. C) There is no basis for trade between the two countries. D) Finland
A supply shock causes the long-run aggregate supply curve to shift left, decreasing the price level
Indicate whether the statement is true or false
If MiiTunes and The Rock Shop are both in the music business and faced with the choices outlined in the figure shown, we can predict the outcome will be that:
This figure displays the choices and payoffs (company profits) of two music shops-MiiTunes and The Rock Shop. MiiTunes is an established business in the area deciding whether to charge its usual high prices or to charge very low prices, in the hopes that a new business will not be able to make a profit at such low prices. The Rock Shop is trying to decide whether or not it should enter the market and compete with MiiTunes.
A. MiiTunes charges low prices and The Rock Shop does not enter.
B. MiiTunes charges high prices and The Rock Shop enters.
C. MiiTunes charges high prices and The Rock Shop does not enter.
D. MiiTunes charges low prices and The Rock Shop enters.
If the general level of prices is lower than business decision makers anticipated when they entered into long-term contracts for raw materials and other resources, which of the following is most likely to occur?
a. An economic boom. b. Highly attractive profit margins. c. An actual rate of unemployment that is greater than the natural rate of unemployment d. A sharp increase in imports.