What is the difference between the consumer price index (CPI) and the GDP deflator? Which would be better to use if you want to measure whether your hourly earnings this year were higher than they were last year? Why?

*11. Indicate whether the following statements are true or false:

a. “For the economy as a whole, inventory investment can never be negative.”

b. “The net investment of an economy must always be positive.”

c. “An increase in GDP indicates that the standard of living of people has risen.”

*12. How do the receipts and expenditures of a stateoperated lottery affect GDP?