A business cycle is the:
A. period of time in which expansion and contraction of economic activity are equal.
B. period of time in which there are three phases: peak, depression, and recovery.
C. recurring growth and decline in real GDP.
D. period of time in which a business is established and ceases operations.
Answer: C
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Real GDP measures the value of goods and services produced in a given year using
A) base year prices. B) prices of that same year. C) future prices. D) no prices. E) government approved prices.
Economists argue for free trade in import markets because
A) all consumers and producers benefit from importing goods. B) the gains to the U.S. producers outweigh the losses to the U.S. consumers. C) the gains to the U.S. consumers outweigh the losses to the U.S. producers. D) no one is made worse off by importing goods. E) importing goods decreases total surplus.
Real GDP is
A) an increase in the average level of prices. B) the value of total production when the unemployment rate is 6 percent. C) the value of total production of all the nation's farms, factories, shops and offices measured in the prices of a single year. D) the value of total production of all the nation's farms, factories, shops and offices measured at the prices of the year it was produced.
The ________ traces out the points for which total quantity of goods produced equals total quantity of goods demanded
A) LM curve B) IS curve C) consumption function D) investment schedule