Which of the following activities is excluded from GDP, causing GDP to understate a nation's well-being?
A. The services of used-car dealers.
B. The child-care services provided by stay-at-home parents.
C. The construction of new houses.
D. Government expenditures on military equipment.
B. The child-care services provided by stay-at-home parents.
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What will happen to the demand for beers such as Natural Light, Coors Light and Bud Light near college towns if students' income increased tremendously?
a. Demand will fall because students love these beers b. Demand will fall because these beers are considered inferior goods c. Demand will rise because these beers are considered inferior goods d. Demand will not change as students are already maximizing their drinking capacity
The GDP gap is the difference between:
a. full-employment real GDP and real GDP chain price index. b. unemployment rate and real GDP chain price index. c. actual real GDP and full-employment real GDP. d. frictional unemployment and actual real GDP.