Inventories — goods produced but not sold — are included in GDP because we want to measure total production, not just what is purchased
a. True
b. False
A
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Using the table above, and assuming no bequest, what amount of consumption is chosen in period 1, if the consumer wants consumption in the two periods to be equal?
If initial wealth is $40,000, what amount of consumption is equal over the two periods?
Suppose that the price of labor (PL) is $10 and the price of capital (PK) is $20. What is the equation of the isocost line corresponding to a total cost of $100?
A) PL + 20PK B) 100 = 10L + 20K C) 100 = 30(L+K) D) 100 + 30 (PL + PK) E) none of the above
Most economists support the idea of peak-load pricing on the grounds of
A. fairness in income distribution. B. efficiency in input usage. C. equality of opportunity. D. efficiency in output allocation.
Which of the following would be considered an example of structural policy?
A. Provision of additional cash to the banking system. B. A reduction in income tax rates. C. An attempt to reduce the government budget deficit by reducing spending. D. A decision by a developing country to reduce government control of the economy and to become more market-oriented.