National income is derived from gross domestic product by
A) adding personal income and transfer payments to gross domestic product.
B) subtracting depreciation from gross domestic product.
C) subtracting retained earnings from gross domestic product.
D) adding personal taxes and depreciation to gross domestic product.
B
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Figure 7-2
In Figure 7-2, average cost at 500 units of output equals
A. 4,000. B. 200. C. 8. D. 6.
An indication that Insurance companies anticipate adverse selection is
a. they do not require a deductible b. they do not classify clients into different risk types according to their claim history c. they do not classify clients into different risk types according to pre-existing conditions d. they require a co-payment
Refer to the above figure. If real GDP is $4 trillion, then
A. consumption expenditures are too low. B. unplanned inventories will increase. C. actual investment spending equals $1 trillion as planned investment spending plus unplanned inventory increases equal $1 trillion. D. unplanned inventories will decrease.
People with savings often deposit their funds in a commercial bank, rather than investing them directly with business enterprises, in order to
A. earn the highest possible return for taking on the riskiest investments. B. avoid the problems associated with asymmetric information. C. avoid the problems associated with financial intermediation. D. All of these are correct.