Describe briefly how the final value of an iPhone must be equal to the sum of incomes generated by the production of the iPhone
What will be an ideal response?
Consider the value of an iPhone which costs $200. Part of the $200 goes to Apple in the form of profit. Part of the $200 goes to the firms that sold Apple the parts that made up the iPhone. Part of the $200 goes to the workers that built the iPhone. A portion of the $200 goes to pay the sales clerk who sells the iPhone. Part of the $200 goes to the trucking company that shipped the iPhone. In fact, all of the value of the $200 ends up as income for someone in the economy. If we extend this idea to the entire economy and add up the value of all goods and services, then the total will equal the total amount of income in the economy.
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Which of the following generally becomes positive when the value of U.S. exports exceeds the value of U.S. imports?
A) capital and financial account B) the balance of payments account C) current account D) the official settlements account E) the exchange rate
Which of the following statements is true?
A) The lower the risk in an investment, the higher is the expected return. B) The higher the risk in an investment, the higher is the expected return. C) The higher the principal amount of an investment, the lower the rate of interest offered on the investment. D) The higher the principal amount on the investment, the higher the rate of interest offered on the investment.
Which of the following is an example of cyclical unemployment?
A. Dora lost her job when the textile factory closed. She does not have skills to work in another industry and has been unemployed for over a year. B. Jim had a job as an engineer, but quit when his wife was transferred to another state. He looked for a month before finding a new job that he liked. C. George is an unskilled worker who mows lawns in the summer, but is unemployed the rest of the year. D. Marsha was laid off from her job with the airline because the recession reduced demand for airline travel. She expects to get her job back when the economy picks up.
Use the following table to answer the question. Dave's Production Possibilities ScheduleSimon's Production Possibilities SchedulePounds of Green BeansPounds of CornPounds of Green BeansPounds of Corn0160080201204060408080406040120208001600Assume Dave consumes 40 pounds of green beans and 80 pounds of corn without trade. Also, assume that Simon consumes 80 pounds of green beans and 40 pounds of corn without trade. Suppose Simon and Dave specialize and that the terms of trade are 1 pound of green beans for 1 pound of corn. If Simon sells Dave 80 pounds of green beans, then the gains from trade for Dave are ________ pounds of green beans and ________ pounds of corn with trade and specialization.
A. 20, 20 B. 0, 40 C. 40, 0 D. 40, 40