What is "underground production"? Is it included in GDP?
What will be an ideal response?
Underground production is the production of goods and services that remain hidden from the government. Underground production includes the production of illegal goods and services and the production of legal goods and services but in a way that avoids taxes or regulations. Underground production is not included in GDP.
You might also like to view...
In the figure above, the shift in the aggregate demand curve from AD1 to AD3 could be the result of an increase in
A) the price level. B) foreign incomes. C) aggregate supply. D) the foreign exchange rate. E) expected future income.
When we assume that consumers want to pay the lowest price possible, we assume that consumers are:
A. cheap. B. deceitful. C. rational. D. informed.
After running a promotional campaign, the owners of a local shoe store decided to decrease the prices for the shoes sold in their store. One can imply that
a. The promotional expenditures made the demand for their shoes more elastic b. The promotional expenditures made the demand for their shoes more inelastic c. The promotional expenditures has no effect on the shoe demand elasticity d. The owners got it wrong. To cover the promotional expenses, they should have raised the prices.
If expected inflation is 2%, the nominal interest rate is 7% and the economy is growing at a rate of 3%, the real interest rate is equal to
What will be an ideal response?