When final sales are larger than GDP,
a. inventories did not change.
b. a net increase in inventories took place.
c. a net decrease in inventories took place.
d. the direction of any net change in inventories is uncertain.
c. a net decrease in inventories took place.
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In long-run perfectly competitive equilibrium, which of the following is false?
A) There is efficient, low-cost production at the minimum efficient scale. B) Economies of scale are exhausted. C) Economic surplus is maximized. D) Firms earn economic profit.
Revenue equivalence ________ hold when the item being auctioned has independent private values and ________ hold when the item being auctioned has a common value.
A) does not; does not B) does; does not C) does; does D) does not; does
Assume the price of good X increases. As a result, your real income decreases and you decrease the quantity of good X purchased each month. This is an example of the:
a. income effect. b. consumer price effect. c. revenue effect. d. substitution effect. e. all of these.
Coal producers cannot profit by acting opportunistically toward U.S. Steel because:
a. there is a wide range of coal producers and substitution possibilities are high. b. coal is a highly specific resource and trades at competitive prices. c. the company usually enters into a delivery contract to obtain coal. d. the market for coal is thin.