A consumption good that would NOT be counted in GDP would be:
A. the coffee Cyndi buys on her way to work in the morning.
B. Cyndi's brand new car.
C. the sunglasses Cyndi bought on clearance sale yesterday.
D. Ford company’s purchase of steel.
D. Ford company’s purchase of steel.
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A decrease in the marginal income tax rate is a fiscal policy which will increase aggregate demand
Indicate whether the statement is true or false
The Chapter 3 multiplier, because it assumes an ________ interest rate, is usually an ________ of the fiscal policy multiplier in the IS-LM model
A) endogenous, underestimate B) endogenous, overestimate C) exogenous, underestimate D) exogenous, overestimate
If a percentage decrease in money supply is followed by a proportional percentage decrease in prices and output, this means that:
a. the velocity of money is constant. b. the economy is in a recession. c. the velocity of money has fallen. d. real GDP is constant. e. the economy is not at maximum capacity
Which of the following is a primary difference between price takers and price searchers that operate in markets with low barriers to entry?
a. The price searchers will maximize profits in the short run, but price takers will not. Price takers can only maximize profits in the long run. b. The price searchers will have to search for the price, while price takers will have to take the price determined in the market. c. The price searchers will be able to earn profit in the long run, but the price takers will not. d. The price searchers may be able to earn profit in the short run, but the price takers will not be able to do so.