As presented in the textbook, gross domestic product is the sum of annual
A) business profits (both incorporated and unincorporated) plus all tax receipts of federal, state, and local governments.
B) consumption, saving, and investment.
C) expenditures for new final goods by consumers, investors, government.
D) total sales of all business firms.
E) wages and salaries paid or received.
C
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Refer to above Table 2-2. What is the increase in real GDP between years 1 and 2 at fixed year 1 prices?
A) 4.3% B) 3.3% C) 2.5% D) 1.9%
Suppose residents of Toadhop live on the Quabache River, a river prone to flooding. Suppose there are 1000 (type A) people who value flood control more than the 1000 (type B) people. Type A Demand QD = 100 ? P Type B Demand QD = 50 ? P Where Q measures the quality of flood control. If the price of a unit of flood control is $100,000 and the citizens of Toadhop did not work together the amount
of flood control purchased would be a. 0 b. 10 c. 25 d. 70
If an economy produces 2,000 units of output with a price level of $2 and the money supply (M) is $1,000, velocity is:
A. 4. B. 500. C. 1. D. 2.
Which of the following is an assumption that economists make?
A. People are very good at assessing the costs of decisions accurately. B. Individuals and firms will act to provide the things people want. C. Most people possess entrepreneurial talent. D. Individuals usually fail to optimize the use of their resources because they think on the margin.