List and describe the four components of GDP
What will be an ideal response?
Consumption expenditures are purchases by consumers of currently produced goods and services, either domestic or foreign. Private investment expenditures are purchases by firms. These include spending on new plants and equipment, newly produced housing and increases in inventory. Government purchases are purchases of newly produced goods and services by federal, state and local governments. They include any goods purchased and the wages and benefits of all government employees. Net exports are net purchases by the foreign sector, which is calculated as domestic exports minus domestic imports.
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When the price of a pizza decreases from $12 to $10, it is definitely the case that the
A) income effect means people buy less pizza. B) substitution effect means people buy more pizza. C) quantity demanded of pizza will not change. D) None of the above answers is correct.
The greater the elasticities of supply and demand, the smaller are the gains from trade
a. True b. False Indicate whether the statement is true or false
The supply of money is determined by
a. the price level. b. the Treasury and Congressional Budget Office. c. the Federal Reserve System. d. the demand for money.
If countries have similar factor endowments and productivities, what type of trade are they most likely to have?
What will be an ideal response?