If the change in business inventories is positive, then final sales are

A. greater than GDP.
B. zero.
C. less than GDP.
D. equal to GDP.


Answer: C

Economics

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If the output gap equals -200 billion, then:

A. potential GDP is lower than actual GDP. B. there is no cyclical unemployment. C. cyclical unemployment equals the sum of structural and frictional unemployment. D. there is a recessionary gap.

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The quantity theory of money predicts that in the ________, a 10 percent increase in the quantity of money leads to a 10 percent increase in ________

A) long run; real GDP B) short run; velocity C) long run; velocity D) long run; price level

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Federal deposit insurance in the United States began in

A) 1864. B) 1933. C) 1968. D) 1984.

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If the price of cereal increases by 10 percent and the amount of milk demanded decreases by 2 percent, then the cross-price elasticity of these goods is:

A. 5. B. 5. C. 0.2. D. 0.2

Economics