How does the calculation of GDP include the costs of natural resource depletion that occurs when output is produced?
A. The value of resource depletion is added to GDP.
B. The cost of resource depletion is not measured in GDP.
C. The cost of resource depletion is added to real but not nominal GDP.
D. Resource depletion causes GDP to overstate well-being.
Answer: B
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If a household has a husband, wife, and two kids, has a standard deduction of $12,600, has itemized deductions of $6,650, and personal exemptions of $16,000 (4*$4,000), then the first ________ of income is federal income tax free.
A. $20,650 B. $28,600 C. $13,250 D. $34,250
When Acme, Inc produces a certain amount of output at least cost, Acme, Inc definitely
A) achieves economic efficiency. B) uses more capital than labor. C) earns a normal profit. D) None of the above is true.
Looking at historical evidence for the United States and other countries, which of the following are TRUE?
I. There is a correlation between the growth rate of the quantity theory of money and the growth rate of real GDP. II. There is a correlation between the growth rate of the quantity theory of money and the inflation rate. A) Only I is true. B) Only II is true. C) Both I and II are true. D) Neither I or II is true.
As disposable income rises:
a. consumption falls, but not by as much as the disposable income rises. b. the average propensity to consume increases. c. saving falls as a percentage of disposable income. d. the average propensity to consume remains unchanged. e. saving rises as a percentage of disposable income.