Economists use the price index to eliminate year-to-year changes in GDP due solely to changes in:
a. the exchange rate
b. the unemployment rate.
c. fiscal spending.
d. consumer demand.
e. the price level.
e
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Cutting taxes
A) will raise disposable income and lower spending. B) will lower disposable income and raise spending. C) will raise disposable income and raise spending. D) will lower disposable income and lower spending.
Refer to the above figure. If the economy is currently operating at point C, then there is
A) a stable long-run equilibrium situation. B) a recessionary gap. C) an inflationary gap. D) unemployment.
The value of a good
a. depends on many factors, including who uses it and under what circumstances. b. is determined by the cost of producing it. c. depends on the labor necessary to supply the good. d. can be measured objectively by a survey of manufacturers of the good.
A firm's demand for labor is derived from the:
A. opportunity costs associated with labor and leisure. B. demand for its output. C. desires and needs of the entrepreneur. D. cost of labor inputs.