The prices for which of the following goods are included in both the GDP deflator and the consumer price index?
A) goods bought by households
B) goods bought by firms
C) good bought by governments
D) goods bought by foreign households (i.e., exports)
E) all of the above
A
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According to OLI theory, a firm might be unwilling to license its production to a foreign firm for fear that its technology may be stolen or its brand name harmed, which leads the firm to internalize control over its asset and set up its own foreign
subsidiary. Indicate whether the statement is true or false
A constant-cost industry is distinguished by the fact that
a. firms' long-run average cost curves are horizontal b. firms' short-run marginal cost curves are horizontal c. firms' short-run average total costs are horizontal d. the short-run industry supply curve is perfectly elastic e. the long-run industry supply curve is perfectly elastic
Governments can impede economic growth for many reasons. Which of the following is not a major reason?
a. Government borrowing can crowd out private investment. b. High taxes can reduce consumption & investment, and they can reduce the incentive to work. c. Government projects may have relatively low marginal returns. d. Governments may spend more than they earn in tax revenues. e. Regulation may damage production incentives.
Critics of supply-side economics argue that tax cuts favored by supply-siders will have the greatest effect on
A. aggregate supply. B. tax receipts. C. aggregate demand. D. the money supply.