Which of the following transactions is included in GDP?
a. You buy a used car for $10,000.
b. An unemployed worker receives a check for $450 as unemployment benefits.
c. You buy a one-acre lot in Florida where you plan to build a beach house.
d. Toyota builds 1,000 Accords in Kentucky at a cost of $25,000 each but is unable to sell them and, therefore, they are added to inventory.
d
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If the Phillips curve aids in forecasting inflation then
A) forecast errors from an alternative forecasting procedure should not be correlated with output fluctuations. B) there should be no correlation between forecast errors from an alternative forecasting procedure and output fluctuations. C) the Phillips curve is upward-sloping. D) the Phillips curve is downward-sloping.
The fixed cost curve:
A. is steep when output levels are low, then flattens as output increases. B. is flatter when output levels are low, then gets steeper as output increases. C. is a constant, flat line. D. is a constant, vertical line.
Negative supply shocks confront the Fed with a dilemma because
a. full employment is no longer possible b. the costs of fulfilling one objective are paid in terms of failure to meet the other c. inflation cannot be prevented considering the reduced supply d. all policy choices are equally undesirable e. such shocks are entirely unpredictable
Refer to Table 8.1. Assume the wage rate is $10 and the firm has $1,000 in unavoidable fixed cost. What is the average cost of producing 65 units of output?
A. $40
B. $15.38
C. $0.50
D. $16