To calculate GDP it is necessary to
A) add the total amounts of all the goods produced.
B) use production cost to place a dollar value on all goods produced.
C) average the cost of producing a good with the price of the good to place a dollar value on all goods produced.
D) use the market price to place a dollar value on each good produced.
E) use the average market price over the last five years to place a dollar value on all goods produced.
Answer: D) use the market price to place a dollar value on each good produced.
You might also like to view...
If the consumption of a good by one individual does not change the amount of the good available to others, the good is considered to be
a. durable. b. nonrival-in-consumption. c. a common good. d. a natural resource.
Bubba is a shrimp fisherman who used $2,000 from his personal savings account to buy a boat and equipment for his shrimp business. The savings account paid 2% interest. What is Bubba's annual opportunity cost of the financial capital that he invested in his business?
a. $20 b. $40 c. $200 d. $400
Each of the following statements describes how the political and legal environment encourages productivity except:
A. Price changes in markets give suppliers incentives to supply goods to markets. B. Pay rates determined by a governmental planning agency provide workers with incentives to work hard. C. Well-defined property rights encourage production and saving. D. Political stability promotes economic growth.
When you go to a baseball game your ticket specifies your seat and section of the stadium where the seat is located. Assuming the seats all cost nearly the same to install and maintain, what pricing strategy would you expect the team officials to adopt if a full stadium with a maximum of satisfied customers and at least normal profit is the goal?
A. Price all seats at cost, which includes normal profit. B. Price above cost for seats with the best view and below cost for less desirable seats so the gain from those willing to pay more for the best seats offsets the loss on the cheap seats. C. Price all seats above cost so if there are empty seats, at least total costs can hopefully be covered. D. Price above cost for the seats with the best view and price at cost for the rest even if this means the stadium is not full. At least total cost with normal profit will be achieved.