Which of the following activities is excluded from GDP, causing GDP to understate a nation's production?
A. The services of health care workers.
B. The services of military personnel.
C. The construction of new buildings.
D. Goods and services produced in the underground economy.
D. Goods and services produced in the underground economy.
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At the end of last year, the CPI equaled 120. At the end of this year, the CPI equals 132. What is the inflation rate over this year?
A) 6 percent B) 10 percent C) 12 percent D) None of the above answers are correct because more information is needed to calculate the inflation rate.
A decrease in the money supply
a. lowers the interest rate, causing a decrease in investment and a decrease in GDP b. lowers the interest rate, causing a decrease in investment and an increase in GDP c. raises the interest rate, causing an increase in investment and a decrease in GDP d. raises the interest rate, causing an increase in investment and an increase in GDP e. raises the interest rate, causing a decrease in investment and a decrease in GDP