Nominal gdp is not an accurate measure of the real level of economic activity in a country because: the gdp deflator consistently underestimates the real cost of living. inflation distorts the real value of all the goods and services produced. base year prices are likely to experience substitution bias. taxes distort the real value of all the goods and services produced.

In 2007, americans smoked 19.2 billion packs of cigarettes. they paid an average retail price of $4.50 per pack. a. given that the elasticity of supply is 0.50.5 and the elasticity of demand is negative 0.4−0.4, derive linear demand and supply curves for cigarettes. the demand equation is qdequals=nothingplus+nothing times ×p and the supply equation is qsequals=nothingplus+nothing times ×p.

Refers to the way we conduct ourselves

Suppose that real interest rates increase across europe. this development will u.s. net capital outflow at all u.s. real interest rates. this causes the loanable funds to because net capital outflow is a component of that curve.