The largest component of GDP is:
A. government purchases.
B. net foreign factor income earned in the United States.
C. gross private domestic investment.
D. personal consumption expenditures.
Answer: D
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In the Solow growth model, given the values of A, s, n, and d, the economy has an equilibrium growth rate of real GDP per capita, (Y/N), equal to
A) n. B) n - d. C) s - n. D) (s - d)/n. E) zero.
Cross-price elasticity of demand is used to determine whether
a. a product is an inferior or normal good b. a product is a necessity or a luxury c. two products are substitutes or complements d. price and total revenue are directly or inversely related e. the product's demand curve is linear
Most economists believe that classical theory describes the world
a. in the short run. b. in the long run. c. in both the short run and the long run. d. in neither the short run nor the long run.
When unregulated monopolies exist,
A. Prices tend to be higher than with a competitive market. B. Externalities occur. C. Quality tends to be higher than with a competitive market. D. Production tends to be higher than with a competitive market.