What problems would result from the measurement of the sales of all goods and services produced?
Measuring the sales of all goods and services would double count many items. For example, a glass pane that is sold to Toyota for a windshield would be counted when it was sold from the glassmaker and again when the automobile (final product) was sold to the consumer.
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The "marginal rate of substitution" between two goods is measured by:
A) the ratio of the market prices of the two goods. B) the number of units of a good consumed divided by the market price of the other good. C) the number of units of one good a consumer would give up to consume one more unit of another good, while holding total utility constant. D) the consumer's budget constraint divided by the price of each good.
Why is a construction worker never likely to earn as much as a famous athlete?
a. Compensating differentials create a higher wage for professional athletes. b. Technological progress has advanced less in the construction industry then in sports training. c. Productivity levels are low in the construction industry due to the high number of people willing to be construction workers. d. A construction worker can provide his services to only a limited number of customers.