Suppose a nation's 2010 nominal GDP was $972 billion and the general price index was 90. To make the 2010 GDP comparable with the base year GDP, the 2010 GDP must be:
a) deflated to $678 billion.
b) deflated to $896 billion.
c) inflated to $1080 billion.
d) deflated to $1080 billion.
c) inflated to $1080 billion.
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All of the following are examples of human capital except:
A. the ability to write clearly. B. knowledge of word processing programs. C. the ability to coordinate labor effectively. D. a computer which has top-of-the-line word processing software.
Which of the following is an expected result of a network externality?
a. An increase in deadweight loss b. An increase in social costs c. A positive spillover effect d. An increase in private costs
Which of the following would cause GDP to overstate the growth in economic well-being over the past 50 years?
A. Increase in leisure time B. Increase in the employment of married women C. Decrease in the employment of maids and housekeepers D. All of the choices are true
Answer the following statements true (T) or false (F)
1. As a nation's average household income rises, the percentage of household income that goes to food expenditures also increases. 2. The percent of total employment in the U.S. that is accounted for by farms has been declining in the last six decades or so, but the absolute number of farm employment has actually risen slightly over those decades. 3. Price support programs for agricultural products tend to cause shortages of these products. 4. The parity concept of agricultural policy suggests that farmers should obtain a constant ratio of the prices they receive for their farm products and the prices they pay for goods and services in general. 5. The farm price-support programs hurt consumers of the farm products, and moreover, the burden tends to be disproportionately heavier on the low-income consumers.