Suppose there are only two firms in an economy: Cowhide, Inc produces leather and sells it to Couches, Inc, which produces and sells leather furniture. With each $1,000 worth of leather that it buys from Cowhide, Inc, Couches, Inc produces a couch and sells it for $2,600 . Neither firm had any inventory at the beginning of 2015 . During that year, Cowhide produced enough leather for 25 couches
Couches, Inc bought 80% of that leather for $20,000 and promised to buy the remaining 20% for $5,000 in 2016 . Couches, Inc produced 20 couches during 2015 and sold each one during that year for $2,600 . What was the economy's GDP for 2015?
a. $25,000
b. $52,000
c. $57,000
d. $65,000
c
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Which of the following is a macroeconomic concept?
A) The elasticity of supply of a good B) The per capita income of a country C) The average revenue earned by a firm D) The income elasticity of demand for a good
If the growth rate of velocity changes:
A. the growth rate of the money supply must change in the same direction. B. the growth rate of the money supply must change in the other direction. C. the growth rate of C, I, G, or NX must change. D. the growth rates of C, I, G, and NX must all change.