ECONOMICS (CBSE/UGC NET)

ECONOMICS

BUSINESS CYCLES

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Suppose a miner harvests a ton of iron ore, an iron smelter turns the iron ore into steel, and a carmanufacturer turns the steel into a car. If the miner adds a value of $1000, the iron smelter sells the steelfor $3500, and the car manufacturer sells the car for $9000, how much has been added to GDP?
A
$4, 500
B
$8, 000
C
$9, 000
D
$13, 500
Explanation: 

Detailed explanation-1: -variables the predict, or lead to, a recession or recovery; examples include consumer confidence, stock market prices, business investment, and big-ticket purchases, such as automobiles and homes.

Detailed explanation-2: -Leading, coincident, and lagging indicators are economic variables that change before, at the same time as, and after changes in real GDP, respectively.

Detailed explanation-3: -The correct answer is (iv) Nominal GDP values production at current prices, whereas real GDP values production at constant prices.

Detailed explanation-4: -Which of the following accurately describes disinflation? It is the process of bringing down the inflation that has become embedded in expectations. The cost of disinflation is the: loss of real GDP in the process.

There is 1 question to complete.