Government expenditures for Social Security and unemployment insurance are, for GDP accounting purposes, considered:
A. transfers, and are included in government spending as part of GDP.
B. transfers, and are not included in government spending as part of GDP.
C. purchases, and are not included in government spending as part of GDP.
D. purchases, and are included in government spending as part of GDP.
Answer: B
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What do we assume about households and firms?
A) They act irrationally. B) They do what the government tells them to do. C) They look after each other. D) They optimize.
Which of the following is not a characteristic of the monopolistic competition market structure?
a. Many sellers, each small in size relative to the overall market. b. Few sellers. c. Differentiated product. d. Easy, low-cost entry and exit.
Why is the market supply curve of labor positively sloped though individual supply curves are backward-bending beyond a certain wage rate?
a. People tend to work less when wage rate increases. b. Every individual laborer has equal trade offs between labor and leisure. c. People tend to substitute labor for leisure. d. People work more for the fear of losing their jobs and becoming unemployed. e. All the individual supply curves do not bend backward at one particular wage rate.
Long-run diseconomies of scale exist over the range of output for which the long-run average total cost curve
a. rises. b. remains constant. c. falls. d. does not exist.