What are the categories of expenditure used in the expenditure approach to measuring GDP?
What will be an ideal response?
There are four expenditure categories. The expenditure approach calculates the sum of consumption expenditure, investment, government expenditure on goods and services, and net exports of goods and services. Net exports of goods and services are the difference between exports of goods and services and imports of goods and services.
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Without specialization, individuals might spend time producing ________ goods.
A. unwanted B. low cost C. high cost D. general
________ flexible wages and prices imply that the short-run aggregate supply curve is ________
A) More; flatter B) Less; steeper C) less; vertical D) More; steeper
The deadweight loss represent the sum of added consumer and producer surplus if the firm would produce the quantity where P = MC
Indicate whether the statement is true or false
In Monetarist theory, the role of the government should be to:
a. Use fiscal policies to ensure that aggregate demand is sufficient to meet aggregate supply. b. Control prices. c. Seek to raise productivity by setting up and enforcing fair rules of behavior, encouraging competitive markets, imposing reasonable taxes, and creating stable and predictable political environments. d. All of the above. e. None of the above.