When calculating gross domestic product (GDP), double counting can be avoided by:
a. taxing corporate income
b. adding all income taxes to GDP.
c. calculating GDP using the income as well as the expenditure method.
d. adding the value of exports to GDP and subtracting the value of imports.
e. summing the value added at each stage of production.
e
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Typically, a capital expenditure project will result in:
a. a cash flow stream to the firm b. a cash outflow from the firm c. an initial (one-year) outflow followed by a series of cash inflows d. for long projects, an initial five-year outflow followed by a series of cash inflows
If Canada can produce 500 TV sets at the cost of 10 cars, while Mexico can produce 1,000 TV sets at the cost of 8 cars, we know the following:
a. Canada has a comparative advantage in TV production. b. Mexico has the absolute advantage in TV production. c. The two countries' joint output equals 1,500 TV sets and 18 cars without trade, but it will be higher after proper specialization and trade. d. Canada has a comparative advantage in car production. e. Canada produces more cars than Mexico does.
The price elasticity of supply
a. will be positive when supply is elastic and negative when it is inelastic. b. will be negative when supply is elastic and positive when it is inelastic. c. will always be positive. d. will be positive when demand for the good is inelastic. e. will be positive when demand for the good is elastic.
Most studies have found that tobacco and marijuana are substitutes rather than complements
a. True b. False Indicate whether the statement is true or false