Changes in business inventories
A) are included in gross but not in net investment.
B) can either be positive or negative.
C) are not included in GDP because they are not sold to anyone.
D) are only partly included in GDP because part of these are holdings of intermediate goods.
B
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Gordon characterizes Modigliani as a prominent activist yet several implications of his life cycle hypothesis support the non-activists. One of these implications is
A) transitory increases in income associated with the business cycle are not expected to last a lifetime so current consumption is relatively stable. B) permanent increases in income associated with the business cycle are not expected to last a lifetime so current consumption is relatively stable. C) transitory increases in income associated with the business cycle are not expected to last a lifetime so current consumption is relatively unstable. D) transitory increases in income associated with the business cycle are to last a lifetime so current consumption is relatively stable.
The effect of the February 2008 tax rebate on spending was reduced due to ________
A) the simultaneous missteps in monetary policy B) the negative impact of the policy on saving rates C) the recognition that the rebate did not constitute a permanent change in income D) the small size of the program