If WarmWear, a U.S.manufacturer of winter clothing, opens a new factory in Austria, then
a. Austrian GNP increases by more than Austrian GDP, because GDP includes income earned by foreigners working in Austria.
b. Austrian GNP increases by more than Austrian GDP, because GDP excludes income earned by foreigners working in Austria.
c. Austrian GNP increases by less than Austrian GDP, because GDP includes income earned by foreigners working in Austria.
d. Austrian GNP increases by less than Austrian GDP, because GDP excludes income earned by foreigners working in Austria.
c
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Based on the data in the above table, gross domestic product equals
A) $2,190. B) $2,840. C) $2,465. D) $2,750.
Rational expectation theory implies that accurately anticipated change in aggregate demand: a. will increase RGDP in the long run
b. will affect RGDP and inflation only in the long run. c. may affect RGDP but not nominal GDP. d. will tend to be offset by the actions of input suppliers as they react to their inflation expectations.