Microeconomics & Macroeconomics

Refer to Table 23-2. What were country A's government purchases in 2019?

$1,975

Refer to Table 23-3. If prices had remained constant between 1929 and 1930, Nominal GDP would have decreased

8.62%.

Oligopoly

An oligopoly is market structure in the economy that is selling a particular good with many buyers and sellers. An oligopoly only has a few firms that sell most or all of the goods in the market. An oligopoly makes their profits if they can work together and form a cartel. An oligopoly can become a cartel by reducing their output so they can in turn raise their prices. If each member of the oligopoly can benefit individual then they can also increase their output.

not part of GDP because it is a transfer payment.

Both the market value of rental housing services and the market value of owner-occupied housing services

Oligopolies

Oligopolies have to use pricing strategies to set their prices. An oligopolistic firm will research their competitors firms and focus on pricing strategies. One example of game theory is prisoner's dilemma which is a concept that focuses on benefits from cooperative behavior instead of self-interested behavior. In the prisoners dilemma a firm has to work to increase cooperative behavior.

Joe and Jim purchase vegetables at a grocery store, but Jim also grows vegetables in his backyard. Regarding these two practices, which of the following statements is correct?

Only Joe's and Jim's grocery store purchases are included in GDP.

Utilitarianism

The political philosophy according to which the government should choose policies to maximize the total utility of everyone in society.

Utility

a measure of happiness or satisfaction.

For the purpose of calculating GDP, investment is spending on

capital equipment, inventories, and structures, including household purchases of new housing.

Government purchases include spending on goods and services by

federal, state, and local governments

For an economy as a whole,

income must equal expenditure.

Unemployment compensation is

not part of GDP because it is a transfer payment.

Changes in real GDP reflect

only changes in the amounts being produced.

When economists talk about growth in the economy, they measure that growth as the

percentage change in real GDP from one period to another