Answer the following statements true (T) or false (F)
1) Within the circular flow model, the level of total resource income and total spending on output
will be approximately equal.
2) In determining GDP by the expenditures method, it is appropriate to use net investment rather
than gross investment as a measure of investment spending.
3) Gross private domestic investment exceeds depreciation in an economy that experiences
expanding production capacity.
4) Interest on the public debt is included as a part of government purchases in determining GDP
by the expenditures method.
5) All expenditures on new construction are included as investment in calculating GDP.
1) T
2) F
3) T
4) F
5) T
You might also like to view...
In January, buyers of gold expect that the price of gold will fall in February. What happens in the gold market in January, holding everything else constant?
A) The demand curve shifts to the right. B) The quantity demanded decreases. C) The demand curve shifts to the left. D) The quantity demanded increases.
Crude oil is not an example of a factor of production, but when crude oil is processed into gasoline, it is a factor of production
Indicate whether the statement is true or false
Food stamps and Medicaid are in-kind transfer programs
a. True b. False Indicate whether the statement is true or false
A bank's assets consist of $500,000 in total reserves, $1,600,000 in loans, and a building worth $1,200,000 . Its liabilities and capital consist of $2,000,000 in demand deposits and $1,300,000 in capital. If the required reserve ratio is 10 percent, what is the level of the bank's excess reserves? How much could it loan out as a result?
a. $200,000; $200,000 b. $200,000; $2,000,000 c. $300,000; $300,000 d. $300,000; $3,000,000