Question

f the economy adds to its inventory of goods during some year, A) this amount should be included in calculating that year's GDP. B) gross investment will exceed net investment by the amount of the inventory increase C) this amount should be subtracted in calculating that year's GDP. D) this amount should be ignored in calculating that year's GDP. (Consider This) From an economist's perspective, when is government too big? A) when the marginal costs from additional government spending exceed marginal benefits B) when government activity exceeds 10 percent of gross domestic product C) when the marginal benefits from additional government spending exceed marginal costs D) Government is always too big. 21) Which of the following will tend to socialize losses and privatize gains? A) government guarantees to private investors that they will get their money back even if the company fails B) lowering interest rates to encourage private borrowing and investment C) government regulation to promote human safety and environmental protection D) government creating projects rather than supporting private efforts 22) When an economy's production capacity is expanding, A) DI exceeds PI. B) nominal GDP, but not necessarily real GDP, is rising. C) gross domestic investment exceeds depreciation. D) net exports is always a positive amount. 23) Suppose American winemakers convince the federal government to issue a direct domestically produced wine at government functions. This would be an example A) logrolling. B) moral hazard. C) rent-seeking behavior. D) the principal-agent p

Answer 1

19) Option A

• The economy adds to its inventory of goods during some year This amount should be included in calculating that years gdp.
• gdp includes the value of all final goods and services produced in a current year within an economy or as country.

As HOMEWORKLIB RULES we can answer only 1 question.

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