Which approach to calculating GDP best highlights the relative importance of different factors of production?
A. The expenditure approach
B. The income approach
C. The value-added approach
D. Any of these measurements would work equally well for that comparison.
B. The income approach
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"The percentage change in quantity demanded divided by the percentage change in price" represents
A) the law of demand. B) the law of one price. C) the price elasticity of demand. D) the responsiveness of consumers to a change in quantity demanded. E) none of the above.
Which of the following statements concerning equilibrium in the long run is not true?
A. Most firms earn economic profits in the long run. B. The firm can vary its plant size in the long run. C. Economic profits are eliminated as new firms enter the industry in the long run. D. For firms in long-run equilibrium, P = MC = AC.
In this graph, one of the end results of the expansionary policy is ______.
a. a permanent shift in output from RGDPNR to RGDP2
b. a shift of price level to PL3
c. a shift in aggregate demand from AD2 to AD1
d. a shift in equilibrium from E1 to e2
The reservation price of good X is
A. the price at which one would be indifferent between good X and simply keeping the money. B. the cost of producing good X. C. the market price for a good. D. any price above what you would be willing to pay for the good.