Nominal GDP differs from real GDP because ________.
A. real GDP is based on current prices
B. nominal GDP is based on constant prices
C. nominal GDP results from adjusting for changes in the price level
D. real GDP results from adjusting for changes in the price level
Answer: D
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Normative statements i. describe how the world is. ii. describe how the world ought to be. iii. depend on people's values and cannot be tested
A) i only B) ii only C) iii only D) ii and iii E) i and iii
Refer to Figure 19-11. The graph above depicts supply and demand for British pounds during a trading day. At a fixed exchange rate of $2.00 per pound, the pound is ________ versus the dollar
A ________ of the pound would correct the fundamental disequilibrium that exists in this market. A) overvalued; devaluation B) overvalued; revaluation C) undervalued; devaluation D) undervalued; revaluation
Suppose that once a well is dug, water flows out of it continuously without any additional effort. Customers collect their water and pay a per gallon fee when they leave the site of the well. In the short run, the competitive firm in this market
A) will not shut down because variable costs are zero. B) has no fixed costs. C) faces diminishing marginal returns. D) can act as a price setter.
Assume health insurance is provided universally by the government. This would
A) eliminate the problems of adverse selection. B) result in adverse selection. C) eliminate the problems of moral hazard. D) All of the above.