For the purpose of measuring the cost of living for consumers, one reason the GDP price index is NOT a good substitute for the CPI is because the GDP price index
A) compares a current year basket of goods with a base year basket of goods.
B) compares current year's prices with base year's prices.
C) includes the prices of exported goods, which are not consumed in the United States.
D) and the CPI move in the same direction over time.
E) has a larger bias than does the CPI.
C
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Which of the following will contribute to higher wage rates for labor?
a. increased productivity b. increases in capital formation c. a decrease in the supply of labor d. all of the above
If Japan's Real GDP rises, this tends to _________________ United States exports, shifting the United States AD curve to the __________________
A) raise; right B) raise; left C) lower; right D) lower; left
What was the result of the Bretton Woods Conference?
(A) The creation of a fixed exchange-rate system for the United States and much of Western Europe. (B) The creation of NAFTA. (C) The creation of a flexible exchange-rate system for the United States and much of Western Europe. (D) The creation of the euro.
Use the following graph showing short-run cost curves for a perfectly competitive firm to answer the next question.
At what price would the firm earn a normal profit and break even?
A. P1 B. P2 C. P3 D. P4