Consider an economy that only produces wooden chairs. In 2012, the economy produced 100 wooden chairs priced at $10 each. The nominal GDP of the economy for the year 2012 will be:
A) $10. B) $1,000. C) $100. D) $10,000.
Consider an economy that produces only cell phones. In the year 2012, the economy manufactures 275 cell phones, and each cell phone sells at $200. In the year 2013, the economy manufactures 280 cell phones but the price of each cell phone falls to $180.
B
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Nominal and real wage rates
A) must always change by the same amount. B) must always change in opposite directions by the same amount. C) must always change in the same direction but could change by different amounts. D) could change in opposite directions. E) must always change in the same direction, and the nominal wage rate must change more rapidly than the real wage rate.
In 2007, Japan reported that its overseas assets totaled more than $4.6 trillion. This implies that Japan
A) is debtor nation. B) has a current account deficit. C) has a capital account deficit. D) is a creditor nation.