Because of the value of things produced in households,
a. the GDP value is adjusted upward.
b. the GDP value is adjusted downward.
c. GDP is probably somewhat smaller than true total output.
d. GDP is probably somewhat larger than true total output.
c. GDP is probably somewhat smaller than true total output.
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The inefficiencies associated with dead capital can
A) lead to increased consumption. B) increase the amount of investment as businesses look for more technologically advanced capital. C) lead to more economic freedom as firms try to get rid of the inefficient capital. D) reduce the rate of return on investment.
If the real interest rate is above zero, we know that the nominal interest rate must be:
A. higher than the inflation rate. B. lower than the inflation rate. C. equal to the inflation rate. D. zero.
To offset increased pessimism by households, the government may _____ government spending and/or _____ taxes
Fill in the blank(s) with correct word
Which of the following is not a function performed by the Federal Reserve?
a) To clear checks. b) To maintain the money supply. c) To establish more effective supervision of the banking system in the United States. d) To keep interest rates low.