If the economy adds to its inventory of goods during some year:
A. gross investment will exceed net investment by the amount of the inventory increase.
B. this amount should be ignored in calculating that year's GDP.
C. this amount should be subtracted in calculating that year's GDP.
D. this amount should be included in calculating that year's GDP.
D. this amount should be included in calculating that year's GDP.
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Which of the following economic variables is affected when the central bank adopts countercyclical monetary policy?
A) Interest rates B) Personal income tax rates C) Government spending D) Corporate tax rates
At the minimum efficient scale
A) all possible economies of scale have not been exhausted. B) marginal cost is at its minimum. C) the firm has achieved the lowest possible average cost of production. D) any increases in the scale of operation will encounter further economies of scale.
Describe the principal costs of unemployment. Are there any benefits to unemployment?
What will be an ideal response?
In Figure 5-1 above, if the budget line BB0, the natural real GDP is $5300, and actual real GDP is $5000, then the cyclical budget surplus or deficit is the
A) horizontal distance between A and F. B) vertical distance between F and D. C) vertical distance A and F. D) horizontal distance between B and D.