An Important Variable That Is Left Out of Economic Models

question 48

Multiple Choice

An important variable that is left out of economic models is

• A) implicit costs.
• B) excess profits.
• C) entrepreneurship.
• D) the opportunity cost of resources.

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Definitions:

NDP

Net Domestic Product, a measure of a country's economic output that accounts for depreciation. It represents the total value of all goods and services produced within a country's borders minus the depreciation of its capital goods.

United States

A country in North America known for its large economy and diverse population, officially known as the United States of America.

Underground Economy

Unreported or illegal production of goods and services that is not counted in GDP.

GDP

GDP, or Gross Domestic Product, represents the entire value of goods and services produced within a nation's boundaries during a certain time frame.