Answer the following questions true (T) or false (F)
1. Nominal GDP measures the value of all final goods and services at base-year prices.
2. The GDP deflator is a measure of the price level which is calculated as nominal GDP divided by real GDP and multiplied by 100.
3. If nominal GDP is less than real GDP, then the GDP deflator will be greater than 100.
1. FALSE
2. TRUE
3. FALSE
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If the real interest rate is 3 percent and the inflation rate is 2 percent, what is the nominal interest rate?
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An American consumer buys a French luxury product in New York. In the U.S. balance of payments accounts, this transaction directly appears in
A) the official settlements account. B) the imports part of the current account. C) the net transfers part of the current account. D) the capital and financial account.
Which of the following is a reason why only limited attempts are made to compensate those who lose from free international trade?
A) Free trade advocates consistently lobby to eliminate compensation. B) It would be difficult to determine the extent to which someone's sufferings were because of free trade and not due to reasons under their own control. C) No one loses in the from free trade in the long run. D) None of the above answers are correct.
If the units of variable input in a production process are 1, 2, 3, 4, and 5, and the corresponding total outputs are 30, 34, 37, 39, and 40, respectively. The marginal product of the fourth unit is:
a. 2. b. 1. c. 37. d. 39.