Small differences in annual growth rates of real GDP generate large differences in real GDP over time because of the:
A. importance of average labor productivity.
B. diminishing returns to capital.
C. limits of economic growth.
D. power of compound interest.
Answer: D
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A bank's revenue comes from all of the following EXCEPT
A) interest earned on vault cash. B) fees for services provided. C) interest on loans. D) interest on securities.
In economics, the concept of opportunity cost is:
a. negated by ensuring that the government has a role in a capitalist society. b. defined to be the highest-valued alternative that must be forgone when a choice is made. c. best illustrated by knowing why consumers choose one good over another. d. quantifiable only if you know the real dollar price of the goods and services you are giving up to consume something. e. the methodology that government economists use to determine the total amount of the national debt.
Which of the following is a leading economic indicator?
a. labor force participation rate b. GDP deflator c. S&P 500 d. Consumer Price Index (CPI)
A factory worker earned $10 an hour in 1980. The CPI was 0.82 in 1980. The same factory worker was earning $15 an hour in 1990 when the CPI was 1.31. From 1980 to 1990, the factory worker's hourly real wage:
A. increased from $10 to $15. B. remained constant. C. decreased from $12.20 to $11.45. D. increased from $7.63 to $18.29.