Which of the following is a TRUE statement concerning economic growth?
A. Changes in per capita nominal GDP are used to measure economic growth because population growth can distort the figures and we want to use the nominal amounts since that is what people identify with.
B. Changes in per capita real GDP are used to measure economic growth because inflation and population growth can distort nominal GDP figures or total GDP figures.
C. Changes in per capita nominal GDP are used to measure economic growth, but there are serious problems concerning the desirability of using figures that do not account for pollution and urban sprawl.
D. Changes in per capita real GDP are used to measure economic growth because this accurately measures all the differences in living standards across countries.
Answer: B
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In the expanded circular flow diagram, the rest of the world interacts directly with
A) product markets. B) factor markets. C) households. D) firms.
The output of Mexican citizens who work in Texas would be included in the
A) net national product of the United States. B) gross national product of the United States. C) gross national product of Mexico. D) gross domestic product of Mexico.
The most used tool of the Fed is:
A. open market operations. B. These are all used with equal frequency. C. the reserve requirement. D. the discount window.
When news reports state that inflation has increased, they could be referring to a change in the GDP deflator.
Answer the following statement true (T) or false (F)