What is PPP and how does it help us to make valid international comparisons of real GDP?
What will be an ideal response?
PPP is purchasing power parity. To make the most valid international comparisons of real GDP, we need to value each nation's production using the same prices rather than by using exchange rates and the prices within each country because relative prices within different countries can vary widely. As a result, if the real GDP of each country is valued using the same prices then the comparison of real GDP among the countries is more accurate.
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Frictional unemployment is a part of the unemployment rate that refers to those workers who are: a. moving between jobs
b. no longer looking for a job because they are discouraged about their prospects. c. jobless due to the seasonal nature of their jobs. d. jobless due to a recession in the economy.
Which of the following statements is not correct?
a. Welfare programs may encourage illegitimate births. b. The decline in welfare benefits since the 1970s has been associated with a decline in the percentage of children living with a single parent. c. Welfare programs may reduce incentives for people to work. d. A negative income tax program uses tax revenues collected from high-income families to provide cash subsidies to low-income families.
An embargo is a prohibition against trading particular goods.
Answer the following statement true (T) or false (F)
Financial instruments used primarily as stores of value would not include:
A. a home mortgage. B. a U.S. Treasury bond. C. a car insurance policy. D. shares of General Motors stock.