Real GDP per person in Australia was $5626 in 1870. Over the next 130 years, it grew at a compound annual rate of 1.145%. If, however, real GDP per person had grown at an average compound rate of 1.5%, then real GDP per person in Australia in 2000 would have been approximately:
A. $24 716
B. $38 975
C. $53 663
D. $73 828
Answer: B. $38 975
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If businesses spend an additional $150 billion for investment projects in 2010, what will be the impact on national income (Y) if the multiplier is 2?
A. Y will increase by $50 billion. B. Y will increase by $150 billion. C. Y will increase by $300 billion. D. Y will increase by $450 billion.
When the government imposes a tariff on imported goods, it _____________ prices for domestic consumers, ________________ consumers' surplus and _________________ the producers' surplus for domestic producers.
A. raises; lowers; raises B. lowers; raises; raises C. lowers; raises; lowers D. raises; lowers; lowers E. none of the above
Suppose that you are attending a sporting event. Give an example of two nondurable goods, two durable goods, and two services you might encounter during this experience.
What will be an ideal response?
Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the short run would be:
A. P1 and Y2. B. P3 and Y1. C. P2 and Y2. D. P2 and Y3.