Consider the economic impact of Hurricane Florence in 2018. Which of the following statements is correct?
A. Spending toward reconstruction would lead to an increase in GDP.
B. Increased government spending on relief efforts in the United States would decrease GDP.
C. Damaged buildings and looting would lead to a decrease in GDP.
D. U.S. well-being improves the more reconstruction efforts are needed, following the decline in GDP.
Answer: A
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A publisher is deciding whether or not to invest in a new printer. The printer would cost $500, and it would increase cash flows by $600 for the next two years. What is the present value of the cash flows from the investment?
a. $1100 b. $541 c. $600 d. $1041
Exhibit 6-1 Business cycle
In Exhibit 6-1, the recession phase of the business cycle can be represented by point(s):
A. CDE. B. BCD. C. EFG. D. A and E.