Refer to the diagram. The base year used in determining the price indices for this economy:
A. cannot be determined from the information given.
B. is some year before 2000.
C. is more recent than 2000.
D. is 2000.
D. is 2000.
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The advantage of using real GDP over nominal GDP is that:
A) it can be compared over time. B) it takes into account the distribution of income. C) it takes into account changes in ruling political party. D) it is easier to calculate.
A firm in a perfectly competitive industry
a. is unaffected by the entrance of new firms into the industry, since entering firms affect only the prices they themselves receive. b. always produces more output in the long run than in the short run. c. may choose a different output in the long run than in the short run. d. earns economic profit in the long run but not in the short run.