Investment, as a part of GDP, includes:
A. stocks.
B. factories.
C. gold.
D. bonds.
Answer: B
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Suppose that you have noticed that almost all of the car dealers in your city are located along a three-block stretch of the same street. A likely reason for this clustering of car dealers is that:
A. each dealer sells a different brand of car, so they are not competitors and do not have to be concerned about the other dealers' locations. B. the dealers are better able to form a cartel. C. there is a social norm in that city that dealers follow in choosing location. D. each dealer is attempting to locate closest to the customers.
In a market economy, the government's power to coerce can:
A. undermine economic efficiency by increasing private-sector risk. B. improve economic efficiency by directing all resources to their most valued uses. C. reduce private-sector risk and increase economic efficiency. D. cause significant negative externalities.
In a situation in which internal costs differ from social costs, we say that there exists a(n)
A) welfare loss. B) welfare benefit. C) internality. D) externality.
If C is consumption, I is investment, G is government purchases and NX is net exports, according to the expenditure approach, Y would stand for ________; and the national income identity could be written as ________
A) transfers; Y = C + I + G - NX B) CPI; Y = C + I + G + NX C) GDP; Y - C - I = G + NX D) income; Y = C - I - G + NX E) the real interest rate; Y = C + I + G + NX