If You Want to Compare Real GDP in 2000 and 2008

question 115

Multiple Choice

If you want to compare real GDP in 2000 and 2008, what prices can you use? I. 2000 prices for the 2000 GDP and 2008 prices for the 2008 GDP II. 2000 prices for GDP in both years III. 2008 prices for GDP in both years

• A) I only
• B) II only
• C) III only
• D) either II or III

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Definitions:

Bliss Point

The optimal quantity of consumption where any further increase or decrease would lead to a lower level of satisfaction for the consumer.

Indifference Curves

Graphical representations in microeconomics to illustrate different combinations of goods between which a consumer is indifferent.

Utility Function

A mathematical representation that ranks preferences or satisfaction levels consumers derive from different bundles of goods.

Perfect Substitutes

Products or goods that can replace each other perfectly with no loss of utility to the consumer.