If business inventories equal $40 billion at the beginning of the year and $55 billion at the end of the year, then, assuming no other changes, GDP must have:
A. increased by $40 billion.
B. increased by $15 billion.
C. decreased by $15 billion.
D. increased by $55 billion.
Answer: B
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A risk averse person's utility of wealth curve has a
A) positive slope and becomes steeper to the right. B) positive slope and becomes flatter to the right. C) negative slope and becomes steeper to the right. D) negative slope and becomes flatter to the right.
A rapid increase in the price of oil will tend to
A) shift long-run aggregate supply to the left. B) shift aggregate demand to the right. C) shift long-run aggregate supply to the right. D) shift short-run aggregate supply to the left.
Suppose there are two markets for football games: rich alumni as fully committed as the lower-income students to their alma mater. Based on this information, which market has the lower price elasticity of demand and pays the higher price if the university price discriminates?
a. The alumni market b. The student market
Consumption consists of spending by households on goods and services, with the exception of
a. purchases of intangible services. b. purchases of durable goods. c. purchases of new houses. d. spending on education.