Because GDP does not fully account for improvements in the quality of goods, the GDP calculation
a. tends to overstate the true value of output in the United States.
b. tends to understate the true value of output in the United States.
c. provides an accurate value of output in the United States.
d. measures the value correctly because price changes always capture the value of quality changes.
B
You might also like to view...
The use of increased taxation to, ceteris paribus, reduce the level of a country's internal debt must reduce its aggregate demand
Indicate whether the statement is true or false
An increase in the marginal propensity to consume (MPC) will cause the consumption function to become steeper.
a. true b. false
Depreciation is
A. added to GDP to get gross investment. B. subtracted from net investment to obtain gross investment. C. the difference between exports and imports. D. added to NNP to get GNP.
Which of the following statements is correct?
A. The U.S. population has increased more rapidly than real GDP in recent decades. B. Improved education and training of labor is the most important source of U.S. productivity growth. C. The average American factory worker has about 16 years of formal education. D. The amount of real capital used per worker has increased historically in the United States.