An unregulated market economy provides material wealth but does not generate effective control of environmental damage.

If you spend more of your income on consumption goods, which of the following will occur?

A) Economic growth will be stimulated. B) For every dollar you spend on consumption, real GDP will fall by a dollar. C) Investments in education will rise. D) The production of investment goods will fall.

If nominal GDP for 2009 is $6400 billion and real GDP for 2010 is $6720 billion (in 2009 dollars), then the growth rate of real GDP is

A) 0%. B) 0.5%. C) 5%. D) 50%.