Refer to Table 25-1

question 98

Multiple Choice

Refer to Table 25-1.What is real GDP in this economy in Year 20 if the annual growth rate is 4%?
A) 2191
B) 8000
C) 20 800
D) 80 000
E) 836 683
Answer: A
Diff: 3
Topic: 25.1a.the nature of economic growth
Skill: Applied
Learning Obj.: 26-3 Explain how commercial banks create money through the process of taking deposits and making loans.
User1: Table
The diagram below shows alternate paths for two hypothetical economies,each starting with GDP of $1 billion.Assume that Area 1 is equal to Area 2. FIGURE 25-1
-Refer to Figure 25-1.Which of the following statements best describes what we know about the difference between the two economies at Year 0?

• A)2191
• B)8000
• C)20 800
• D)80 000
• E)836 683
• Answer: A
• Diff: 3
• Topic: 25.1a.the nature of economic growth
• Skill: Applied
• Learning Obj.: 26-3 Explain how commercial banks create money through the process of taking deposits and making loans.
• User1: Table
• The diagram below shows alternate paths for two hypothetical economies,each starting with GDP of $1 billion.Assume that Area 1 is equal to Area 2. FIGURE 25-1
• -Refer to Figure 25-1.Which of the following statements best describes what we know about the difference between the two economies at Year 0?
• A)Economy A has a higher level of real GDP at Year 0 than Economy B.
• B)Economy B's households are consuming a larger percentage of GDP than Economy A's households.
• C)There is no opportunity cost for economic growth for Economy B at Year 0.
• D)There is no opportunity cost of economic growth for Economy A at Year 0.
• E)Economy A's households are consuming a larger percentage of GDP than Economy B's households.

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Definitions:

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