Jennifer lives in a home that was newly constructed in 2011 for which she paid $240,000 . In 2014 she sold the house for $260,000 . Which of the following statements is correct regarding the sale of the house?
a. The 2014 sale increased 2014 GDP by $260,000 and had no effect on 2011 GDP.
b. The 2014 sale increased 2014 GDP by $20,000 and had no effect on 2011 GDP.
c. The 2014 sale increased 2014 GDP by $260,000; furthermore, the 2014 sale caused 2011 GDP to be revised upward by $20,000.
d. The 2014 sale affected neither 2014 GDP nor 2011 GDP.
d
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Nations with low levels of GDP per capita may converge to richer nations if
A) nations with high levels of income experience a continuously increasing growth rate. B) nations with lower levels of income grow more quickly than those with higher levels of income. C) nations with lower levels of income grow more slowly than those with higher levels of income. D) nations with lower levels of income spend less on investment.
Labor productivity is $30 per hour and aggregate hours are 165 billion hours. What does real GDP equal?
What will be an ideal response?
Refer to Figure 15-11. In the dynamic model of AD-AS in the figure above, the economy is at point A in year 1 and is expected to go to point B in year 2, and the Federal Reserve pursues policy. This will result in
A) unemployment rates higher than what would occur if no policy had been pursued. B) real GDP lower than what would occur if no policy had been pursued. C) short-term interest rates higher than what would occur if no policy had been pursued. D) inflation higher than what would occur if no policy had been pursued.
Refer to Scenario 10.7. How many ink pads will be produced to maximize revenue?
A) 0 B) 250 C) 300 D) 500 E) none of the above