In official government statistics, the GDP deflator is actually calculated using:
A. a method called a chain-weighted index.
B. the ratio of nominal GDP to real GDP from the year before it.
C. the value of a market basket that households typically purchase.
D. a simpler approach, so the results are easily comparable.
Answer: A
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Considering the concept of cross-price elasticity, if two goods are complements:
A. an increase in the price of one will cause a decrease in the demand for the other. B. an increase in the price of one will cause an increase in the demand for the other. C. a decrease in the price of one will cause a decrease in the demand for the other. D. the cross-price elasticity is positive.
How do prices provide incentives in a competitive market?
a. Higher prices cause buyers to purchase less of a good or service. b. Higher prices cause producers to make less of a good or service. c. Lower prices result in buyers and sellers dropping out of the market. d. Lower prices inspire buyers and sellers to become entrepreneurs.
The table below shows the units of land and labor required to produce a unit of bread and cheese respectively in Country X. Identify the correct statement. 1 Unit of Bread1 Unit of CheeseLabor Input5 units20 unitsLand Input4 units10 units
A. Production of bread is relatively labor-intensive in the country. B. The opportunity cost of producing an extra unit of bread is four units of cheese. C. The domestic price ratio in the country is two units of bread per unit of cheese. D. Production of bread is relatively land-intensive in the country.
A monopolist would probably earn fewer profits if
A) the importance of specialized capital equipment in its production techniques increased. B) the time length of patents increased. C) environmental regulations increased that required the purchase of special capital equipment. D) tariffs on competing products were lowered.