If the GDP deflator is less than 100, which will be higher: nominal GDP or real GDP? Why?
What will be an ideal response?
Real GDP will be higher. The GDP deflator is the ratio of nominal GDP to real GDP, so if the value is less than 100, nominal GDP must be smaller than real GDP.
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Common stocks are ____ risky for the issuing corporation and ____ risky for the corporation’s stockholders, compared to other financial assets, such as bonds.
A. unusually; unusually B. less; more C. more; less D. very; not
Figure 34-6
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From the graph in Figure 34-6, the opportunity cost of a unit of bananas is
A. 4 units of corn for England and 1/2 unit of corn for Honduras. B. 1/4 unit of corn for England and 2 units of bananas in England. C. 8 units of corn in England and 3 units of corn in Honduras. D. 4 units of corn in England and 12 units of corn in Honduras.