Double markup problems arise when
a. upstream firms have market power
b. downstream firms have no market power
c. upstream and downstream products are unrelated in demand
d. upstream and downstream firm's pricing decisions tend to increase the demand for the other product
a
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Which of the following is included as government purchases in gross domestic product (GDP)?
a. Social Security payments to elderly citizens b. Welfare benefits distributed to the poor c. Outright grants from government to recipients d. Payments to clerical workers hired by government e. Unemployment compensation benefits
Which of the following is true of a recessionary gap? a. It develops when the expected price level is less than the actual price level
b. In the long run, this gap closes when resource suppliers negotiate lower resource payments. c. It measures the amount by which actual output is greater than the economy's potential output. d. In the long run, this gap closes when the short-run aggregate supply curve shifts rightward. e. In the long run, this gap closes when the aggregate demand curve shifts rightward.