Consider the following simplified sequence of exchanges. A logger sells an oak tree to a sawmill owner for $60. The sawmill mills it, and sells the boards to a woodworker for $80
The woodworker makes an oak bookcase out of the boards, and sells it to a retailer for $300. The retailer then sells you the bookcase for $500. As a result, GDP increases by A) $200.
B) $300.
C) $440.
D) $500.
E) $940.
D
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If velocity does not change and if real GDP and the quantity of money grow at the same rate, then the price level
A) does not change and the inflation rate is zero. B) falls and the inflation rate is negative. C) rises and the inflation rate is negative. D) falls and the inflation rate is positive. E) rises and the inflation rate is positive.
________ is the additional satisfaction a person receives from consuming an extra unit of a good
A) Total utility B) Marginal utility C) Diminishing marginal utility D) Preferences
In an open economy, the quantity demanded of bikes in the domestic market is ________.
A. 100,000 B. 20,000 C. 50,000 D. 80,000
If the price were $8, what would the firm do in the (a) short run? (b) the long run?
