The following data show nominal GDP and the appropriate price index for several years. Compute real GDP for each year and indicate whether you have “inflated” or “deflated” nominal GDP in finding real GDP. All GDP are in billions
To get the answers for real GDP change the price index to percent (divide each index by 100), then divide nominal GDP by the percent price index. For example, in year #1, divide $117 by 1.20 to get $98 in real GDP. If the real GDP is less than the nominal it has been deflated; if the real GDP is more than the nominal GDP it has been inflated.
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The present value of $525 received one year from today, assuming an annual rate of return of 5 percent is
a. $551.25 b. $525 c. $500 d. none of the above
Household production is not measured in the GDP
Indicate whether the statement is true or false
In the study of labor supply, "leisure" refers to
a. time spent sleeping. b. time spent doing absolutely nothing (except breathing). c. time spent in one's place of residence. d. time spent that is not spent in market work.
To sell an extra unit of output, a perfectly competitive firm ________, and an imperfectly competitive firm ________.
A. must hope the market price falls; must lower its price B. must lower its price; must lower its price C. need not alter its price; must lower its price D. need not alter its price; need not alter its price