The circular flow of income shows that GDP can be measured as the sum of wages, interest, rent, and profits received by households or total expenditures on goods and services by households, firms, government, and the rest of the world
Indicate whether the statement is true or false
TRUE
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Consumers in a country buy only two goods, pens and CDs. The prices and quantities purchased by urban households are in the table above. The reference base year is 2011. If the current year is 2012, the cost of the CPI market basket in 2012 is
A) $3,400. B) $3,508. C) $3,580. D) $3,500. E) $3,588.
If we assume competitive labor markets, the supply curve of labor when the firm is a monopoly is
A) upward sloping. B) vertical. C) horizontal. D) downward sloping.
Inflation is defined as the sustained increase in relative prices
a. True b. False Indicate whether the statement is true or false
Refer to Exhibit 6. Who has the comparative advantage in the production of good Y?
A) Maria B) Maya C) Both Maria and Maya D) Neither Maria nor Maya.