The Main Effect of a Decrease in the Stock of Capital

question 98

Multiple Choice

The main effect of a decrease in the stock of capital is a(n)

• A)rightward shift of the short-run aggregate supply curve
• B)rightward shift of the aggregate demand curve
• C)leftward shift of the long-run aggregate supply curve
• D)leftward shift of the aggregate demand curve
• E)increase in price and output levels

Distinguish between intermediate goods and final goods in the context of GDP calculation.

Appreciate the effect of inflation and deflation on real GDP and nominal GDP.

Interpret economic indicators related to GDP, including per capita real GDP and the GPI.

Assess the implications of the underground economy on the measurement of GDP.

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Definitions:

Measurement

The process of obtaining a quantitative description of an attribute or phenomenon, often by comparing it to a standard unit.

Predictability

The ability to accurately forecast the outcome of a process or the occurrence of an event based on current knowledge or past experience.

Normal Distribution

A probability distribution that is symmetric around the mean, showing that data near the mean are more frequent in occurrence than data far from the mean.

Human Traits

Characteristics or qualities that define individual human beings, ranging from physical properties to personality attributes.