The Components of GDP Using the Income Method (Excluding Indirect

question 47

Multiple Choice

The components of GDP using the income method (excluding indirect business taxes and depreciation) are

• A) consumption expenditures, investment expenditures, and government expenditures.
• B) consumption expenditures, investment expenditures, government expenditures, and net exports.
• C) wages and interest.
• D) wages, interest, rents, and profits.

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Definitions:

Short-run Phillips Curve

A graphical representation in economics showing a short-term inverse relationship between inflation and unemployment rates.

Long-run Aggregate-supply Curve

Represents the total quantity of goods and services that producers in an economy are willing and able to supply at different price levels when all production inputs are variable.

Short-run Aggregate-supply Curve

A curve in macroeconomics that shows the relationship in the short run between the price level and the quantity of goods and services that firms are willing and able to supply.

Long-run Phillips Curve

The long-run Phillips Curve illustrates the relationship between inflation and unemployment when expectations of inflation are fully adapted, often showing no trade-off between inflation and unemployment in the long run.