What is the difference between real GDP and nominal GDP?
(A) Real GDP includes nonmarket activities; nominal GDP has no nonmarket activities.
(B) Real GDP allows for depreciation; nominal GDP allows for no depreciation.
(C) Real GDP is based on constant prices; nominal GDP is based on the current year's prices.
(D) Real GDP is accurate to hundreds of dollars; nominal GDP is accurate to thousands of dollars.
Ans: (C) Real GDP is based on constant prices; nominal GDP is based on the current year's prices.
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Along a linear demand curve,
a. both the slope and price elasticity are constant b. the price elasticity is constant, but the slope varies c. total revenues are constant d. the slope is constant, but the price elasticity varies e. total revenues are negative
Suppose there is a flood in St. Louis, Missouri, that destroys several beer bottling facilities. Which of the following would not be a direct result of this event?
a. Sellers would not be able to produce and sell as much as before at each relevant price. b. The supply would decrease. c. Buyers would not be willing to buy as much as before at each relevant price. d. The equilibrium price would rise.