Answer the following statement(s) true (T) or false (F)
1. National income accounting is a uniform means of measuring economic performance.
2. Economists use the quantity produced to measure the value of goods and services for GDP.
3. GDP includes the value of new goods as well as used goods.
4. For the economy as a whole, expenditures must equal income.
5. (X – M) is a spending category for the expenditure approach.
1. TRUE
2. FALSE
3. FALSE
4. TRUE
5. TRUE
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To avoid trade restrictions, a U.S. firm moves its final production process to Ireland and then ships the final products to Germany. This is an example of
A) trade deflection. B) trade diversion. C) protectionism. D) rules of origin.
A shortage exists in the market for corn at the prevailing price. The shortage will be eliminated by a price: a. increase, increasing the supply and decreasing the demand
b. decrease, increasing the supply and decreasing the demand. c. decrease, increasing the quantity supplied and decreasing the quantity demanded. d. increase, increasing the quantity supplied and decreasing the quantity demanded.
In the definition of marginal propensity to consume, propensity to consume refers to ______.
a. the amount of extra taxes someone pays as a result of extra income b. the total income someone receives, including any extra income c. the additional amount of disposable income someone receives d. the amount of additional income spent on consumer goods and services
Figure 5.4In Figure 5.4, supply elasticity is zero in graph:
A. A. B. B. C. C. D. D.