Which of the following represents a problem with using per capita GDP to compare standard of living between less-developed and industrially advanced countries?
a. GDP per capita does not take into account differences in population between countries
b. GDP is particularly difficult to measure in industrially advanced countries because a much larger percentage of economic activity occurs outside of officially measured market activity than in less-developed countries.
c. GDP per capita will overstate the prevailing standard of living for the average person in countries with extreme levels of income inequality.
d. None of the above are correct.
c
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The opportunity cost of producing one more unit of a good is calculated by dividing the
A) total quantity of the other good by the total quantity of the good whose opportunity cost we're calculating. B) decrease in the quantity of the other good by the increase in the quantity of the good whose opportunity cost we're calculating. C) price of the good whose opportunity cost we are calculating by the number of units of the other good that are forgone. D) total quantity of that good by the total quantity of other good. E) increase in the quantity of that good by the decrease in the quantity of other good.
The current U.S. population is about 300 million yet the current U.S. labor force is only about 150 million. What subtractions are made from the population number to set it equal to the labor force?
What will be an ideal response?
Using a big-push strategy for LDC economic development, the private sector
a. does not participate at any stage b. participates actively only at the beginning c. contributes matching funds to all government-financed projects d. participates after the government push creates the multiplicity of markets e. hurts the process by charging high prices for goods produced since it typically has monopoly power
The view that decision-maker expectations are based on actual outcomes observed during the recent past is called the
a. rational expectations hypothesis. b. adaptive expectations hypothesis. c. permanent income theory. d. recognition lag.