If a particular measure of real GDP consistently underestimates growth in real GDP, then the rate of inflation as measured by the GDP deflator
A) will be biased upward.
B) will be biased downward.
C) will be unbiased.
D) cannot be calculated.
A
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The above figure shows the market for buckets of golf balls at the driving range. A new leisure time tax is placed on suppliers in this market, shifting the supply curve from S0 to S1. The tax incidence is
A) split equally between buyers and sellers, each paying $1 per bucket. B) split equally between buyers and sellers, each paying $2 per bucket. C) such that buyers pay $2 per bucket and sellers pay $1 per bucket. D) such that buyers pay $1 per bucket and sellers pay $2 per bucket. E) such that sellers pay all of the tax.
With an increase in the real interest rate, consumption and real gross domestic product will most likely change in which of the following ways?
A) Increase/Increase B) Increase/Decrease C) Decrease/Increase D) Decrease/Decrease E) No change/Increase