Federal government purchases, as a percentage of GDP:
a. have remained roughly the same since the early 1950's.
b. have fallen since the early 1950's.
c. have risen since the early 1950's.
What Is The Gross Domestic Product:
A country's Gross Domestic Product, also referred to as its GDP, is the most popular metric used by economists to track a country's economic health. The GDP measures the value of goods produced in a country, regardless of where they are sold.
Answer and Explanation:
The correct answer is b. have fallen since the early 1950's.
- This is because, prior to the 1950's, there was a very large portion of GDP that was reserved for military purchases to fund the second world war. In addition, global GDP has increased tremendously since the 1950's, notably in the United States and China.
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from Economics 102: MacroeconomicsChapter 4 / Lesson 3