econ 202
If your grandparents buy a new retirement home, this transaction would affect
Investment
Percent increase in real GDP from 2012-2013
0 percent
What is the value of real GDP
1060
GDP Deflator
113
What is the value of nominal GDP
1200
Percent increase in prices from 2011-2012
13 percent
Approximate Percent increase from 2012-2013
22 percent
what was the rate of inflation over this period?
5.4 %
absolute advatage
Ability to use fewer resources
Market Failure
Allocation of goods and services is not efficient
Deadweight loss is greatest when
Both supply and demand are relatively elastic
ratio of nominal GDP to real GDP then multiplied by 100
GDP Deflator
Comparative advantage
Can produce good at lower opportunity cost
Absolute advantage
Can produce using fewer resources
A tax on gasoline is likely to
Cause a greater deadweight loss in the long run when compared to the short run
If cross price elasticity between two goods is negative, the two goods are likely to be
Complements
The reduction of tax
Could increase tax revenue if the tax had been extremely high
Productivity can be increased by?
Improving the education of workers
The Burden of tax falls more heavily on the sellers in a market when
Demand is elastic Supply is inelastic
The burden of tax falls more heavily on buyers in a market when
Demand is inelastic Supply is elastic
A tax collected from buyers generates a smaller deadweight loss than a tax collected from sellers
FALSE
An increase in the price of diamonds will have a greater impact on the CPI than an equal percentage increase in the price of food.
FALSE
In the United states, investment is the largest component of GDP
FALSE
Tariffs tend to benefit consumers
FALSE
The largest category in the CPI is medical care
FALSE
When we use the model supply and demand to analyze a tax collected from the buyers, we shift the demand curve upward by the size of the tax
FALSE
which of the following products would be least capable of producing an externality?
Food
The "Basket" on which the CPI is based is composed of
Products purchased by the typical consumer
If Nominal GDP in 2013 exceeds nominal GDP in 2012, then the production output must have
Risen or fallen because theres not enough information
If a tax is placed on a good in a market where the supply is perfectly inelastic, there is no deadweight loss and the sellers bear the entire burden of tax
TRUE
Landlord question
Tax falls on landlord
Difference between what the buyer pays and the seller recieves
Tax wedge
Which of the following about a binding price ceiling is true?
The shortage created by the price ceiling is greater in the long run than in the short run
which statement is normative
The unemployment rate should be lower
externality
When one persons actions have an impact on a bystander
Workers in the united states enjoy a high standard of living because...
Workers in the united states are highly productive
Inferior good
a good characterized by negative income elasticity
If consumers think that there are very few substitutes for a good, then
demand would tend to be inelastic
U.S. GDP would exclude which of the following
cotton purchased by Lee Jeans
If U.S. GDP exceeds U.S. GNP, then
foreigners are producing more in the united states than americans are producing in foreign countries
normative statement
prescription for how the world ought to be
supply of diamonds is inelastic. A tax on diamonds would generate a..
small deadweight loss, burden of tax would fall on sellers
