The nominal gross domestic product (GDP) for a country was 1,000 in 2003 and 1,500 in 2004 . The GDP price index was 100 in 2003 and 150 in 2004 . Between 2003 and 2004, real GDP _____.
a. increased by 500
b. increased by 333
c. increased by 50
d. remained the same
e. decreased by 50
QUESTION 2In a competitive labor market a firm will continue to employ workers for as long as an additional worker's marginal revenue product exceeds the wage rate.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 3Discretionary fiscal policy works by shifting the short-run aggregate supply curve.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 4If the nominal gross domestic product (GDP) for the year 2000 was 6.2 trillion and the price index was 200, the real gross domestic product (GDP) for 2000 was _____.
a. 3.1 trillion
b. 6.2 trillion
c. 12.4 trillion
d. 18.6 trillion
e. 24.3 trillion
QUESTION 5Marginal revenue product of labor measures the extra revenue generated to the firm from the employment of an additional worker.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 6Discretionary fiscal policy works by shifting the aggregate demand curve.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 7Suppose the real gross domestic product (GDP) equals 200 billion this year and the nominal gross domestic product (GDP) equals 300 billion. This implies that the price level has increased by _____.
a. 100 billion
b. 200 billion
c. 50 percent
d. 100 percent
e. 33 percent
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