In 2008, the Ace Card Company produced $10 million worth of playing cards. Because of strong consumer demand for their product in 2008, Ace sold $12 million worth of cards, reducing their inventories by $2 million. How much value did Ace add to GDP in 2008?
a. $2 million
b. $8 million
c. $10 million
d. $12 million
e. $14 million
C
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A national taco chain offers in-house customers free refills on drinks. It is clearly
A) attempting to increase its total profit. B) generating a negative externality. C) generating a positive externality. D) engaging in predatory pricing. E) doing none of the above.
If the market price of a perfectly competitive firm's product is below its average variable cost, then the firm's
A) marginal revenue is zero. B) total revenue is as large as possible. C) total revenue if it stayed open would be less than its total variable costs. D) total revenue if it stayed open is less than its total cost but greater than its total fixed costs.
Primary dealers are those
A) permitted to trade directly with the Fed. B) who work under the account manager at the Federal Reserve Bank of New York. C) who specialize in selling bonds to small private investors. D) responsible for assuring that interest rates do not decline unless the FOMC has given specific instructions that they decline.
In _________ each person makes concessions giving in a little in order to gain a valued settlement or outcome such as harmony
a. Assimilation b. Compromise c. Valuation d. Socialization