Why are transfer payments excluded from the GDP and NI? Why should they be counted as a part of personal income?
What will be an ideal response?
They are excluded from GDP and NI because no current economic good is produced and no current service is rendered in exchange for them. Since GDP counts only currently produced goods and services, transfer payments do not qualify for inclusion.
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If Joey goes surfing for four hours instead of earning $10 per hour for those four hours, his opportunity cost is
A) the good time spent surfing. B) the cost of gasoline used to get to the beach. C) the travel time to the beach. D) $40.
If a firm is using a resource hired in a perfectly competitive market, and if the marginal resource cost is less than its marginal revenue product,
a. more of the resource should be used. b. less of the resource should be used. c. the firm should pay a lower price for the resource. d. the firm should pay a higher price for the resource. e. the firm is using the optimal amount of the resource.
During the 1990s many countries developed a monetary policy framework that focused on inflation targeting. This is an example of policymakers:
A. developing a new intermediate target that will effectively result in the final objective. B. focusing exclusively on an intermediate target that will effectively result in the final bojective. C. focusing on multiple numerical targets. D. focusing directly on an objective.
Consumer surplus is the area located on the demand and supply graph ________ the equilibrium price point
a. below b. at the same point as c. above d. it is not found on the demand and supply graph