Net domestic product
a. represents total wages and salaries in an economy
b. equals GDP minus indirect business taxes
c. equals GDP minus capital depreciation
d. equals C + I + G + (X – M)
e. is the value of existing capital stock used up in making goods
C
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China runs a current account surplus with the United States. Which of the following must be true about China's balance of payments with the United States?
A) Its net exports must be negative. B) It must run a financial account deficit. C) Its balance of payments must run a deficit. D) Its balance of trade must be in deficit.
Economists tend to judge a model based upon
A) the reality of its assumptions. B) the accuracy of its predictions. C) its simplicity. D) its complexity.
Quarts of orange juice at a local grocery store are priced at one for $3.00, or two for $5.00 . The marginal cost of buying a second quart of orange juice:
a. equals $2.00. b. equals $2.50. c. equals $3.00. d. equals $5.00.
A profit-maximizing firm will always operate at that output at which _______ is equal to ________.
Fill in the blank(s) with the appropriate word(s).