In calculating GDP, the value of intermediate goods is eliminated by using the
A. value added method.
B. distributive method.
C. value association method.
D. Federal Reserve method.
Answer: A
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The Hong Kong dollar is pegged to the U.S. dollar at a rate of 7.8 Hong Kong dollars to 1 U.S. dollar. Suppose the central bank of Hong Kong changes the exchange value to 7.3 Hong Kong dollars to one U.S. dollar. Which of the following is most likely to be true in this context?
A. The Hong Kong dollar has been devalued by 0.5 percent. B. The Hong Kong dollar has been devalued by 6.2 percent. C. The Hong Kong dollar has been revalued by 6.4 percent. D. The Hong Kong dollar has been revalued by 0.5 percent.
The unemployment that occurs as jobs are eliminated because of changing technology is known as
A. frictional. B. voluntary. C. structural. D. fundamental. E. cyclical.
Suppose the MPC in the economy in Figure 10.2 equals 0.75 and the shift from AD0 to AD1 was caused by a decrease in investment of $50 billion. What will happen to the equilibrium level of real output as a result of the initial $50 billion decrease?
A. It will fall by exactly $200 billion. B. It will fall by more than $200 billion. C. It will fall by less than $200 billion. D. It will fall by less than $67 billion.
If the demand for one good decreases when the price of another good increases, the two goods are ________ goods.
A. normal B. inferior C. complementary D. substitute