Transfer payments are ________.
A. excluded when calculating GDP, because they do not reflect current production
B. excluded when calculating GDP, because they only reflect inflation
C. included when calculating GDP, because they are a category of investment spending
D. included when calculating GDP, because they increase the spending of recipients
Answer: A
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Economists define efficiency as
A. output maximization. B. the absence of waste. C. input maximization. D. the presence of surplus.
Monetary and price instability will
A) encourage domestic citizens to increase their rate of saving. B) encourage businesses to invest and expand their future output. C) make it easier for both individuals and businesses to plan wisely for the future. D) generate uncertainty, and encourage investors and businesses to move their activities to countries with a more stable monetary environment.
If government regulators want a natural monopolist to earn only zero economic profit, they will set price equal to:
A. average total cost (ATC). B. marginal cost (MC). C. average fixed cost (AFC). D. average variable cost (AVC).
What type of consumer goods is more affected by the business cycle: durable goods or nondurable goods? Why?
What will be an ideal response?