A change in business inventories is:
A. not counted in GDP because it does not represent final sales.
B. counted in GDP as investment.
C. counted in GDP as net exports.
D. counted in GDP as consumption.
Answer: B
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All of the following issues were discussed as options for reforming the international financial architecture EXCEPT
A) how high an interest rate the lender of last resort should charge when it makes loans. B) the length of the payback period. C) the size of the loans. D) the moral hazard problem associated with a lender of last resort. E) if the lender of last resort (i.e., the IMF) should consult and collaborate with other international institutions such as the United Nations and the WTO.
Andrew Carnegie is most recognized for:
a. being the first manufacturer to utilize the assembly line in large-scale production. b. being a leader in the steel industry. c. helping implement many of FDR's New Deal policies. d. being a prominent Civil War general.
Personal income is equal to:
a. NI minus personal income tax. b. NI minus net factor income from abroad. c. NI plus income currently earned but not received - income currently received but not earned. d. NI minus indirect business taxes. e. NI plus income currently received but not earned - income currently earned but not received.
Within the AD/AS model, how does an economy adjust to an output beyond its long-run capacity as a result of an unanticipated increase in aggregate demand?
a. Wage rates and resource prices will fall, causing a decrease in aggregate demand and the restoration of equilibrium at a higher price level. b. Long-run aggregate supply will increase, leading to a new equilibrium at a lower price level. c. Resource prices and real interest rates will rise causing output to fall back to its long-run sustainable rate. d. Lower real interest rates will stimulate demand and restore equilibrium at the initial price level.