Suppose in the beginning of 2013, a country has a national debt of $5,000 billion. Its GDP in 2013 is $20,000 billion and its budget surplus of $130 billion. Compute its debt-GDP ratio at the end of the year.

If the government has no debt initially, but then has annual revenues of $10 billion per year for 4 years and annual expenditures of $10.5 billion per year for 4 years, then the government has

A) a budget surplus of $0.5 billion per year and a debt of $2 billion at the end of the 4 years. B) a budget deficit of $0.5 billion per year and a debt of $2 billion at the end of the 4 years. C) a budget surplus of $0.5 billion per year and a surplus of $2 billion at the end of the 4 years. D) a budget deficit of $0.5 billion per year and a budget surplus of $2 billion at the end of the 4 years.

Firm A charges $8.50 for each unit of Good X. If the average total cost of producing 1,000 units of Good X is $12 and the market for Good X is monopolistically competitive, Firm A ________ by producing 1,000 units of Good X

A) earns a profit of $3,500 B) earns a profit of $1,000 C) incurs a loss of $1,000 D) incurs a loss of $3,500