How are final goods and services valued when measuring nominal GDP?
A) at producer cost
B) at base year prices
C) at foreign exchange parity
D) at current market prices
E) at factor market prices
D
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The value of marginal product of labor
A) is the change in total product that results from selling one more unit of a good. B) is equal to the price of the good produced multiplied by the marginal product of labor. C) is equal to marginal revenue multiplied by the quantity. D) increases as the amount of labor employed increases.
Suppose there was a banking crisis. The money supply would shrink by the greatest amount if the public ________ their currency—deposit ratio and the banks ________ their reserve—deposit ratio
A) decreased; decreased B) decreased; increased C) increased; decreased D) increased; increased
An author who writes newspaper columns for $75 each is deciding whether to purchase a personal computer with a laser printer. She figures she'd be able to write two more columns per month than she could on her typewriter. She should
a. buy the computer if the monthly payment is less than $300 b. buy the computer regardless of its price c. not buy the computer if the monthly payment is greater than $75 d. not buy the computer regardless of the price e. buy the computer if the monthly payment is less than $150
One advantage of team production over contracting out is that
a. the cost of negotiating and enforcing contracts is generally lower with team production than with contracting out. b. the principal agent problem is eliminated by team production but cannot be addressed in contracting out. c. costs are always lower with team production because of the elimination of transactions costs. d. efficiency is always greater with team production.