The difference between GNP and NNP is accounted for by:
(a) Depreciation;
(b) Net factor income from abroad;
(c) Indirect Taxes/subsidies;
(d) Transfer Payments.
Answer: (a) Depreciation;
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Many central banks around the world target an inflation rate of about ________, because of upward bias in measured inflation and to reduce the risk of deflation
A) -2%. B) 0%. C) 2%. D) 5%.
An increase in autonomous investment in a small open economy will cause ________
A) a trade surplus to shrink B) a trade deficit to increase C) lower net capital outflows D) all of the above E) none of the above
The natural rate of output is the amount of real GDP produced
A. when the economy is at the natural rate of aggregate demand. B. when the economy is at the natural rate of unemployment. C. when the economy is at the natural rate of investment. D. when there is no unemployment.
If the Fed buys $5 million in government bonds, how much will the money supply change?
A. It will increase by $5 million. B. It will increase by more than $5 million. C. It will decrease by $5 million. D. It will decrease by more than $5 million.