During the First Three Quarters of 2015, Real GDP Went

question 1

Multiple Choice

During the first three quarters of 2015, real GDP went from $200 to $220 to $180. Economists describe the second quarter of 2015 as a(n)

• A) contraction.
• B) inflation.
• C) peak.
• D) recession.
• E) trough.

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Definitions:

Gross Profit

The financial measure calculated by subtracting the cost of goods sold from total sales revenue.

Work in Process Inventory

The total value of unfinished goods that are in the process of being manufactured at a given period.

Raw Materials Inventory

The stock of primary materials used in the manufacturing process before they are converted into finished goods.

Factory Labor

The direct and indirect labor costs incurred in manufacturing products, including wages and benefits of workers involved in production.