Which of the following statements is the best critique of the use of GDP per capita to compare welfare between nations?
A. GDP per capita is commonly used as a measure of welfare so it must be a valid measure.
B. GDP per capita is independent of the country's currency so it is not subject to change due to variations in exchange rates.
C. GDP per capita is calculated in a consistent and reliable way so it is not subject to measurement errors.
D. GDP per capita is highly correlated with alternative measures of quality of life.
Answer: D
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Which of the following would be an illustration of a microeconomic issue affecting U.S. auto manufacturers?
A) An introduction of new, more fuel efficient models by Japanese competitors. B) A recession in Europe that causes U.S. auto exports to Europe to decline. C) A decline in the demand for new cars in the U.S. due to an economic downturn. D) An appreciation of the U.S. dollar relative to the Japanese yen.
Use the figure below to answer the following question.
Refer to the three demand curves. A "decrease in quantity demanded" caused by a change in price would be illustrated by a change from
A. point 1 to point 6. B. point 2 to point 5. C. point 5 to point 1. D. point 6 to point 4.