A radiologist buys a new x-ray machine from General Electric to use in her medical practice. This x-ray machine is included in GDP as
A. part of gross private domestic investment.
B. a nondurable consumption good.
C. a service.
D. a durable consumption good.
Answer: A
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Suppose Clem's Chemical Company wants to increase its total revenue. If there are few substitutes for Clem's Chemicals
A) Clem should increase the price of his chemicals. B) Clem should decrease the price of his chemicals. C) the demand for chemicals is elastic. D) Clem will not be able to change the price of his chemicals.
The components of the U.S. M1 money supply are demand and checkable deposits plus
A) currency. B) currency plus savings deposits. C) currency plus travelers checks. D) currency plus travelers checks plus money market deposits.
Financial intermediaries are specialists in the production of
A) market failure. B) information. C) traded assets. D) commercial paper.
The perfectly competitive model makes a lot of fairly unrealistic assumptions. Why do economics text books still talk a lot about this model?
A) Many markets are close to being perfectly competitive. B) It is an important model to use as a benchmark to compare other markets structures to. C) Perfectly competitive markets maximize societal welfare. D) All of the above.