Which of the following would be counted as investment when calculating gross domestic product?
a) the purchase of a used computer by an auto manufacturer
b) the purchase of a share of IBM stock by an employee
c) the construction of a new house
d) the construction of roads by the government
e) the profit earned when selling shares of stock
Ans: c) the construction of a new house
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If policymakers in an open economy want to increase the wealth of their citizens, should they seek to increase saving, or to increase investment? Explain
What will be an ideal response?
Which of the following is not included in a nation's balance of payments?
a. Imports and exports of services. b. International interest and dividend earnings. c. International real estate transactions. d. Changes in a nation's money supply due to a new required reserve ratio. e. All of the above are included in the balance of payments.
When a customer takes out a loan from a bank, this loan is:
a) a liability for the bank. b) savings for the bank. c) a loss for the bank. d) an asset for the bank.
As a percentage of GDP, the national debt consistently
A. fell from 1950 until 1990. B. fell from 1950 to 1975. C. rose from 1950 to 1960, but not thereafter. D. rose from 1950 to 1975.