The rate of real economic growth
a. is underestimated using measures of income growth
b. is overestimated using measures of income growth.
c. is underestimated using measures of technological growth.
d. is overestimated using measures of technological growth.
a
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What other markets were affected by the decline in the housing market beginning in 2006? Briefly explain why
What will be an ideal response?
Which of the following is an example of an automatic stabilizer?
a. Congress legislates lower tax rates to increase consumption and investment. b. Tax rates are increased during a recession to maintain a balanced budget. c. A regressive income tax system reduces tax revenues (as a share of income) as income expands. d. Revenues from the corporate income tax increase sharply during a business boom but decline substantially during a recession, even though no new tax legislation has been enacted.
An important difference between the GDP deflator and the consumer price index is that
a. the GDP deflator reflects the prices of goods and services bought by producers, whereas the consumer price index reflects the prices of goods and services bought by consumers. b. the GDP deflator reflects the prices of all final goods and services produced domestically, whereas the consumer price index reflects the prices of some goods and services bought by consumers. c. the GDP deflator reflects the prices of all final goods and services produced by a nation's citizens, whereas the consumer price index reflects the prices of final goods and services bought by consumers. d. the GDP deflator reflects the prices of all goods and services bought by producers and consumers, whereas the consumer price index reflects the prices of final goods and services bought by consumers.
Transfer payments are excluded from government purchases in GDP accounting because:
A. they are difficult to measure. B. they are a reward to individuals who have been productive their entire lives. C. they are already included as part of investment. D. nothing is being produced in return for the payment.