Econ Final

All of the following describe economic conditions during the Great Depression in the US except A) high rates of unemployment B) high rates of inflation C) low levels of production D) a sharp decline in stock prices

B

Which of the following would be included in the GDP of the United States?

Boeing builds a plane in Seattle that is sold to Air Canada

Which of the following would not be studied in marcoecon? A) The causes of the Great Depression B) The growth rate in of the US economy C) How sharp a increase in gasoline prices is likely to affect SUV sales D) The impact of government spending on the economy

C

Suppose that when the price of broccoli is $4 per pound, buyers wish to buy 500 pounds per day and sellers wish to sell 800 pounds per day. In this case

Excess supply will lead the price of broccoli to fall

the most commonly used measure of an economy's output is

GDP

one shortcoming of real GDP as an indicator of society's social well-being is that it fails to take into account the

non-market production

Inflation ______ the signals sent by price changes to demanders and suppliers of goods and services.

obscures

"The plan to create private accounts in social security will reduce benefits for some workers" is an example of _____ statement, while "social security will be better if the private accounts are allowed" is an example of a ______ statement

positive; normative

Positive economic principles are those that

predict how people will behave

The value of the marginal product of labor equals the marginal product of labor times the

price of output

Three equivalent ways to measure GDP are total _____, total _____, and total _____

production, income, expenditure

Globalization ______ the wages of workers in the exporting industries and ______ the wages of workers in the import-competing industries.

raises; lowers

average labor productivity times the proportion of the population employed equals

real GDP per person

Deregulation of the airline, trucking, telephone, and electric utility industries are examples of ______ policy

structural

A CPI that equals 1.34 in 2019 (when 2010 is the base year) means that

the average level of prices in 34 percent higher in 2019 than in the base year

The economic surplus of an action is

the difference between the benefit and the cost of taking an action

If pencils and paper are complements for most consumers, then if the price of paper increases, you would expect

the equilibrium price and quantity of pencils to fall

Inflation is the increase in

the general level of prices

Compound interest is

the payment of interest on both the original deposit and all accumulated interest

Average labor productivity is determined by

the quantity and quality of human capital, physical capital, technology, natural resources, entrepreneurship, and the legal and political environment.

Human capital is

the talents, training, and education of workers

GDP is a measure of an economy's

total output

The fraction of people who would like to be employed, but can't find work is called the

unemployment rate

The annual percentage rate of change in the price level is the

inflation rate

Kendall is thinking about going to the movies tonight. A movie ticket costs $15, and she'll have to cancel a $20 dog-sitting job that she would have been willing to do for free. Kendall's opportunity cost of going to the movies is

$35

If real GDP per person in a country equals $20,000 and 40 percent of the population is employed, then average labor productivity equals

$50,000 (20,000 / .40)

The consumer price index for Planet Econ consists of only two items: books and hamburgers. In 2018, the base year, the typical consumer purchased 10 books for $25 each and 25 hamburgers for $2 each. In 2020, the typical consumer purchased 15 books for $30 each and 30 hamburgers for $3 each. The consumer price index for 2020 on Planet Econ equals

1.25

In a country with 200 million people aged 16 years and older, 120 million are in the labor force, and 114 million are employed, what is the unemployment rate?

5 percent

Suppose that the technology used to manufacture laptops has improved. The likely result would be

An increase in supply of laptops

The determination of the nation's money supply is called

Monetary policy

When a market is not in equilibrium

The economic motives of sellers and buyers will move the market to its equilibrium

Assume both the demand for bagels and the supply of bagels increase. Which of the following outcomes is certain to occur?

The equilibrium quantity of bagels will rise

Excess demand occurs

When price is above the equilibrium prices

A decrease in both the equilibrium price and the equilibrium quantity of rice is best explained by

a decrease in the demand for rice

All else equal, relative to a person who earns minimum wage, a person who earns $30 per hour has

a higher opportunity cost of taking the day off work

The entire group of buyers and sellers of a particular good or service make up

a market

US productivity growth rebounded in 1995-2000 largely as a result of

advances in information and communication technology

Assume consumers eat either rice or pasta for dinner every night. If the price of rice increases, in the pasta market one would expect to see:

an increase in the demand for pasta

Despite some problems with equating GDP with economic well-being, higher real GDP per person does imply greater economic well-being because it tends to be positively associated with:

better education, health, and life expectancy

A movement along a demand curve from one price-quantity combination to another is called a

change in quantity demanded

If the demand for cucumbers falls when the price of tomatoes rises, then we know that tomatoes and cucumbers are

complements

The fact that most people make some decisions based on intuition rather than caluation is

consistent with cost-benefit model because most people intuitively weigh costs and benefits

periods of usually low production in an economy result in _________ unemployment

cyclical

the extra unemployment that occurs during periods of recession is called ________ unemployment

cyclical

In the US the real wages of the least-skilled, least-educated workers have _____ and the wages of best-educated, highest skilled workers have _____.

declined; increased

Suppose that new scientific studies conclude that high-fiber diets do not reduce the risk of developing colon cancer as well as was previously thought. The likely result will be that the

demand for high-fiber foods will decrease

If the price of TVs produced by XYZ-TV Company falls from $1,000 to $750 per TV set, then the:

demand for labor by XYZ-TV company decreases

A person 16 year or older who works part-time is officially classified as

employed

Malena Suraez would like to work 40 hours per week but can only find 20 hours per week of work. In the official employment statistics, Malena is classified as

employed

Macroeconomic issues include all of the following expect: A) productivity B) economic growth C) energy reserves D) recessions and expansions

energy reserves

An example of a government policy to provide a framework within which the private sector can operate productively is

establishing well-defined property rights

Suppose demand decreases, but there is no change in supply. As the market reaches its new equilibrium

excess supply will lead the price to fall

A decrease in the federal income tax is an example of _____ policy

fiscal

When government revenue is less than government spending, the nation has a

government budget deficit

Economics is best defined as the study of

how people make choices in the face of scarcity and the implications of those choices for a society as a whole

Sharing the results of applied research conducted under government sponsorship with the private sector, such as development of the Global Positioning System (GPS), is an example of a government policy to promote economic growth by

improving technology

Goods and services provided by state and local governments are

included in GDP at cost

As a result of a war in the country of Omega, refugees flee to the country of Alpha to seek employment. Holding other factors constant, the influx of refugees will ______ the real wage in Alpha and ______ employment in Alpha.

increase; increase

Holding other factors constant, if oil prices rise relative to the prices of other products, then the real wages of oil workers will _______ and unemployment of oil workers will ________

increase; increase

Increasing the capital available to the workforce, holding other factors constant, tends to ______ total output while ______ average labor productivity.

increase; increasing

The quantity that sellers wish to sell tends to _______ as price increases, and so the supply curve is _______ sloping

increase; upward

A year's tuition at a state university cost $250 in 1972 when the CPI equaled 0.418. The cost of a year's tuition at the same state university cost $8,000 in 2018 when the CPI equaled 2.40. The real cost of tuition between 1972 and 2018

increased

Real wages increased in industrialized countries in the twentieth century because the demand for labor:

increased more rapidly than the supply of labor increased

If average labor productivity increases while population and the number of employed workers remain constant, than output per person

increases

The duration of unemployment ______ during a recession

increases

In the long run, increases in output per person arise primarily from

increases in average labor productivity

Holding other factors constant, technological progress ________ the real wage and _________ employment

increases; increases

The construction of the interstate highway system in the US is an example of a government policy to promote economic growth by

increasing physical capital

The major labor market problem in the United States is ______ and in Western Europe the problem is _______.

increasing wage inequality; high persistent unemployment

If an increase in income leads to a decrease in the demand for ground beef, then ground beef is an

inferior good

the movement of workers between jobs, firms, and industries is called

worker mobility