Suppose you have one hour to catch a flight to Miami for spring break, and it takes 45 minutes to drive to the airport. Your car is almost out of gas and the price of gas at the closest gas station is higher than at other gas stations that are much farther away. To you, the price elasticity of demand for gas is likely to be ________ than it would be if you had several hours before the flight.
A. more variable
B. higher
C. lower
D. no different
Answer: C
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Capital goods are
A. long-lived goods used for producing other goods and services. B. excluded from GDP. C. the end products of production. D. publicly provided.
Answer the next question on the basis of the following information: Three goods are produced in an economy in the following amounts: A = 10, B = 30, C = 5. The current year per unit prices of these three goods are A = $2, B = $3, and C = $1.If the per unit prices of the three goods were each $1 in a base year used to construct a GDP price index, then real GDP in the current year is ________.
A. $160 B. $115 C. $45 D. $110
Production functions A and B result in the same average total costs of production. However, production function A is twice as capital intensive as production function B. In this case, all else constant:
A) marginal costs will be higher in A than they are in B. B) marginal costs will be higher in B than they will in A. C) because total costs are equal, marginal costs will be equal for the two production functions as well. D) there is no way to say anything about the relative marginal costs of production in the two production functions without additional information.
Suppose the GDP implicit price deflator was 112.7 in 2013 and 116.0 in 2014. Therefore, the inflation rate in 2014 would be
A) 2.8%. B) 2.9%. C) 3.3%. D) 16%.