This year, real GDP per person in Country A is eight times real GDP per person in Country B
If Country B's real GDP per person grows at a rate of 5 percent, about how many years will it take for Country B to reach the level of real GDP per person in Country A in this year?
A) 42 years
B) 56 years
C) 14 years
D) 28 years
E) It will never reach Country A's level of GDP per person.
A
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Answer the following statements true (T) or false (F)
1. Changes in the level of inventories are an internal force in the economy’s cyclical movements. 2. Cost changes generally lag behind price changes during the business cycle. 3. A recession occurs whenever there’s a decline in real GDP for two or more successive quarters. 4. Involuntary inventory accumulation may occur during the contracting phase of the business cycle. 5. Psychological forces have no effect on business fluctuations.
Susan quit her job as a teacher, which paid her $36,000 per year, in order to start her own catering business. She spent $12,000 of her savings, which had been earning 10 percent interest per year, on equipment for her business. She also borrowed $12,000 from her bank at 10 percent interest, which she also spent on equipment. For the past several months she has spent $1,000 per month on
ingredients and other variable costs. Also for the past several months she has earned $4,500 in monthly revenue. In the short run, Susan should a. shut down her business, and in the long run she should exit the industry. b. continue to operate her business, but in the long run she should exit the industry. c. continue to operate her business, but in the long run she will probably face competition from newly entering firms. d. continue to operate her business, and she is also in long-run equilibrium.
Figure 34-7
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In Figure 34-7, AB represents the production possibilities of Pestoland and CD that of Pastaland. The graph indicates Pestoland has an absolute
A. advantage in both pesto and pasta. B. and comparative advantage in both pesto and pasta. C. advantage in both goods, but a comparative advantage only in pesto. D. advantage in pesto only and a comparative advantage only in pasta.
Refer to the table. The outcomes of the three possible sets of paired-choice majority votes illustrate the:
A. paradox of voting.
B. inefficiency of logrolling.
C. principal-agent problem.
D. the benefits of majority rule.