If an economy's population grows at 3 percent and real GDP grows at 2 percent, then:
A. per capita real GDP is declining.
B. the economy's standard of living is increasing.
C. per capita real GDP is negative.
D. per capita real GDP is growing.
Answer: A
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During most of the 1980s, 1990s, and 2000s the U.S. has had a ________ current account balance and a ________ capital and financial account balance
A) positive; positive B) positive; negative C) negative; positive D) negative; negative
GDP and GNP may differ
A) because some income generated by domestic production may be received as income by foreign residents. B) because some intermediate good inputs are imported. C) because some workers are illegal aliens. D) whenever tariff rates become excessively high.
Why is wage and price flexibility an important assumption of the classical model?
A) Flexible wages and prices guarantee that there will be no scarcity. B) Flexible wages and prices allow business firms to fool their workers through the money illusion. C) Flexible wages and prices allow business firms to fool their customers through the money illusion. D) Flexible wages and prices allow markets to reach equilibrium.
Countries with low levels of GDP per capita usually also have:
A. mandatory military service. B. highly developed infrastructures. C. low levels of schooling. D. high levels of schooling.