The GDP deflator in year 2 is 105, using year 1 as the base year. This means that, on average, the cost of goods and services is
A) 5% higher in year 2 than in year 1.
B) 105% higher in year 2 than in year 1.
C) 5% higher in year 1 than in year 2.
D) 105% higher in year 1 than in year 2.
Answer: A
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The marginal revenue curve for a monopoly firm starts at the same point on the vertical axis as the (i) average revenue curve. (ii) marginal cost curve. (iii) demand curve
a. (i) only b. (i) and (ii) only c. (i) and (iii) only d. (iii) only
If rent ceiling is set below the equilibrium rent. . .
What will be an ideal response?
In an effort to balance the federal budget, an increase in Social Security taxes is passed. What is the most likely effect of this on equilibrium GDP?
A. GDP will increase. B. GDP will decrease. C. GDP will not change but prices will rise. D. GDP will not change but employment will increase.
The quantity of good M is measured along the vertical axis, and the quantity of good N is measured along the horizontal axis. If the prices of both goods M and N declines by 50% each, then the budget line
A) shifts inward to the left by 50%. B) shifts outward to the right by 50%. C) shifts outward to the right by 100%. D) rotates clockwise by 180 degrees.