Solved

Economic Studies Have Concluded That a New Bill Lowering the Trade

question 249

Multiple Choice

Economic studies have concluded that a new bill lowering the trade restrictions on the importation of sugar would be good for the economy. President Sweet Tooth highlights the results of this study in his state of the union address and sends the "Sweet Tooth" bill to Congress. Another economic study declares that subsidizing coal mining and orange growing have both been found to be economically inefficient in that the costs outweigh the benefits. However, a subsidy on coal mining would help the coal producers in West Virginia and a subsidy on orange growing would help the orange farmers in Florida. So when the "Sweet Tooth" bill makes its way through congress the senators from West Virginia and Florida will only vote for it if they have their coal-mining and orange-growing subsidies attached to it. The bill gets to President Sweet Tooth with these and other economically inefficient subsidies attached to it, and he passes the bill in its entirety. Which term best describes what just happened?

Differentiate between nominal and real GDP and understand the effects of inflation.

Identify the sources of GDP from the perspective of expenditure and income approaches.

Understand the distinction between microeconomics and macroeconomics contexts.

Appreciate the limitations of GDP as a measure of economic well-being and quality of life.

Definitions:

Positron Emission Tomography

An imaging technique used in medical diagnostics that detects pairs of gamma rays emitted indirectly by a positron-emitting radionuclide.

Electrical Stimulation

The application of electrical impulses to nerves or muscles to evoke a response, often used in medical treatment and research.

Computerised Tomography

A medical imaging technique that uses computer-processed combinations of multiple X-ray measurements taken from different angles to produce cross-sectional images of specific areas of a scanned object, allowing the user to see inside the object without cutting.

Positron Emission Tomography

A nuclear medicine functional imaging technique used to observe metabolic processes in the body as an aid to the diagnosis of disease.