How does a wheat farmer's contribution to national output get counted in the gross domestic product if the Bureau of Economic Analysis measures only the value of final goods, such as loaves of bread?
What will be an ideal response?
It is included in the cost of materials purchased by those who produce and sell loaves of bread.
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Economists estimated that the cross-price elasticity of demand for beer and wine is -0.83 and the income elasticity of wine is 5.03. This means that
A) beer and wine are substitutes and wine is a luxury good. B) beer and wine are substitutes and wine is an inferior good. C) beer and wine are complements and wine is a luxury good. D) beer and wine are complements and wine is an inferior good.
Which of the following statements regarding black markets is true?
a. The reliability of products sold in black markets is generally higher than the reliability of products sold in legal markets. b. The prices of goods in black markets are generally lower than the prices of similar products in legal markets. c. The laws of supply and demand do not affect the prices of goods exchanged in black markets. d. The rate of violence is higher in black markets than in legal markets.
Figure 33.3 illustrate Lorenz curves for four different economies. Which economy will have a Gini coefficient of zero?
A. A. B. B. C. C. D. D.
If aggregate supply is totally price inelastic, an increase in aggregate demand will:
a) Increase price but not output b) Increase output but not price c) Increase output and price d) Decrease output and price