Gross Domestic Product equals
A) Y = C + I + G + NX.
B) Y = C - I + G + NX.
C) Y = C + I + G - NX.
D) Y = C + I - G + NX.
E) Y = C - I - G - NX.
A
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Social Security provides incentive for individuals to
(a) save more than they consume during their working years. (b) manage their assets privately in order to prepare to live on principal and interest during retirement. (c) rely on transfer payments made by the working class to them during retirement. (d) carefully manage their private retirement portfolios and use the income earned to consume and save during retirement.
The monetarist explanations of the Great Depression focus on
a. falls in the LM curve and aggregate demand. b. falls in aggregate supply. c. fall in the IS curve and aggregate demand.. d. falls in expectations and the expected price level.
The Continental Congress faced several constraints in its effort to finance the Revolutionary War. The largest source of funds for the War was:
a. excise taxes. b. domestic bond sales. c. borrowing from foreign powers, such as France. d. printing money.
Answer the following statements true (T) or false (F)
1. The GDP counts durable goods only during their year of production. 2. In national income accounting, machine depreciation is treated as a cost of production, but damage to a region’s air quality is not. 3. The GDP is reported on a monthly basis by the Department of Commerce. 4. An increase in the price level adds to the value of the nominal GDP but not to the real GDP. 5. An increase in business inventories would be included in the investment component of GDP. 6. GDP overstates national income because it does not make any adjustment for national debt. 7. Most national wealth in the United States is held in the private sector.